OptionsHouse

Options Trading News

August 27, 2013  Tue 2:45 AM CT

X: SEE CHART GET CHAIN FIND STRATEGIES
A large trader is looking for U.S. Steel to stay range-bound through next spring.

optionMONSTER systems detected the sale of 3,000 April 18 puts for the bid price of $2.31 yesterday. This is clearly a new position, as open interest in the strike was just 14 contracts before the trade appeared.

Less than a minute later, a block of 120,000 shares of X was sold for $18.815. Combined with the puts, that would make for a delta-neutral play that is short volatility. This means that the trader is looking for shares to remain range-bound and/or for the actual volatility to be less than that implied by the options. (See our Education section)

X was up fractionally yesterday to close at $18.69, in the middle of its recent range. Shares of the steel maker were at a low around $16 in late April and tested resistance at $19.50 two weeks ago.
Share this article with your friends


Related Stories

X

Heavy put buying targets U.S. Steel

March 4, 2015

The steel maker gapped higher after announcing quarterly results on Jan. 27 but is now at the lower end of a range that has been in place since that report.

OptionsHouse

TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Webinar Recording

Turbo Charge Your Trading Profits

Education & Strategy

Gamma

As we continue to discuss the Greeks, we come to the first of the strike based Greeks called Gamma. Gamma is known as the second derivative, while delta is the first.

View more education articles »