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June 19, 2014  Thu 4:45 AM CT

CDNS: SEE CHART GET CHAIN FIND STRATEGIES
Cadence Design Systems has been plowing higher, and one big investor wants a piece of the action.

optionMONSTER's tracking systems detected the sale of 10,000 November 16 puts for $0.55. There was no open interest in the contracts before the trade appeared, which shows that it is a new position.

Selling puts lets the investor collect income now while obligating him or her to buy shares at the strike price if it falls to that level. In the case of yesterday's trade, the entry would actually be $15.45 because of the credit received. That's also the same area where the stock peaked in March, which could make chart watchers expect it to provide support. (See our Education section)

CDNS fell 0.18 percent to $16.90 yesterday but is up more than 20 percent so far this year. It's been climbing on strong demand for its software, which is used by engineers to design semiconductors and electronics. The last two earnings reports beat expectations, and chip makers have been strong as well.

Total option volume in CDNS was more than 140 times average amounts in the session.
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Timing the Trade

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