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April 12, 2013  Fri 9:53 AM CT

ASTX: SEE CHART GET CHAIN FIND STRATEGIES
Astex Pharmaceuticals is pulling back after spiking higher in recent months, but one trader apparently believes that the stock will hold current levels.

A trader sold 2,825 May 6 puts for the bid price of $0.40 and bought 4,175 May 4 puts for the ask price of $0.05, according to optionMONSTER systems. Volume was above open interest in the May 6s but below it in the May 4s.

This is likely a trader is rolling a short-put position higher. The May 4 puts have practically lost all of their value, so he or she is apparently left with the bet that ASTX will hold above $6 over the coming weeks. (See our Education section)

ASTX is down 1.62 percent this morning to $6.22. Shares have run up from $3 in late February and reached an intraday high of $6.47 yesterday.

optionMONSTER systems show that 7,700 ASTX options have changed hands this morning, already welll above its full-session average. 
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Market Level Making You Nervous, Huh? Part 3

In last week's article, we discussed how important the extra cash you save by using the Stock Replacement Strategy over buying the actual stock is! That extra cash in our account instead of being unnecessarily tied up in a stock position allows us to buy the puts we would need to protect our downside in the case of a major sell-off.

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