Options Trading News

March 21, 2013  Thu 9:22 AM CT

As Pandora continues to pull back today, one trader apparently sees limited upside potential for the online radio service in the next six months.

optionMONSTER systems show that 3,583 September 14 calls were sold in one print for the bid price of $1.95. This is fresh activity, as open interest in the strike was just 194 contracts before the session began.

The calls were not tied to any trading in the underlying shares identified by our systems so far today. These options could have been sold naked with an initial bearish bias, but they were more likely sold against an existing long position as a covered call strategy. The latter would be bullish, but only up to the $14 strike price. (See our Education section)

P is down 0.73 percent this morning to $13.58. It closed just above $14 a couple of times last week as it set 52-week highs, which were about double the share price at 52-week lows in November.
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The art of trading

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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