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January 8, 2013  Tue 9:19 AM CT

Tiffany has been rebounding strongly in recent days, but one trader apparently believes that further upside is limited.

More than 10,000 May 65 calls have traded so far today, led by a big print of 7,386 that was sold for $2.90, according to optionMONSTER systems. The volume was well above the strike's open interest of 2,747 at the beginning of the day, so this is clearly a new position.

This call selling appears to be a straightforward bet that TIF will close below the $65 strike price at expiration in mid-May. It is quite likely that the options were sold against long shares as a covered call strategy.

TIF is up 1.05 percent to $61.74 today. The jewelry icon bounced sharply off support at $56 last week and this morning closed the gap that was opened in late November after its earnings report.
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