Learn the trade here. Make it on tradeMONSTER

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

Will U.S. Steel keep momentum?

July 7, 2014

The steel maker has been coming back to life along with other metal companies as investors turn to an industry group that lagged the broader market in 2011 and 2012.

TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Free Webinars

Education & Strategy

How to navigate earnings season

We are embarking on one of the most frustrating times for new option traders: earnings season.Many new traders buy options,...

View more education articles »
optionMONSTER stockMONSTER tradeMONSTER