Options Trading News

September 25, 2013  Wed 3:16 AM CT

Ebix is down sharply this month, but traders apparently believe that the slide is ending.

More than 2,800 October 9 puts were sold yesterday, mostly for $0.40, according to optionMONSTER's tracking systems. The volume was more than twice the strike's previous open interest, indicating that new positions were established.

These put sellers are looking for EBIX to stay above $9 through expiration in mid-October. If it falls below that strike price, the traders will face the obligation to buy shares at that level. (See our Education section)

EBIX was up 0.5 percent yesterday to close at $9.96. The controversial insurance-software company came into September at $11.55 but has been trending lower since, falling below its 50-day moving average along the way.
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As I stated in last week's article, a break out or a break down needs to have a couple things happen before it is considered a confirmed break out or break down. The only problem is that in today's market where things move much more quicker than they did just a few years ago, two days could wind up being the majority of the expected movement, if not the whole movement.

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