Unusual Options Activity
Achillion Pharmaceuticals (ACHN)- 17,500+ Jan 2016 $15 calls were sold for $0.60-$0.70, against open interest of 25,897 contracts. Analysts see the licensing partnership with JNJ/ACHN as a sign that Achillion isn’t a takeover target. UBS downgraded them to neutral this morning.
BGC Partners (BGCP)- Another 7,000 Aug $10 calls were sold for $0.20, against open interest of 20,125 contracts. They’re beginning to sell these quickly (open interest was 36,690 contracts on May 6th).
Brocade Communications Systems (BRCD)- 4,500 June $13 calls were bought for $0.19-$0.24. Earnings are due out tomorrow night (up on 4 of the last 7 reports).
Southwest Airlines (LUV)- Large buying in the July $37 puts (10,000+ traded) and July $38 puts (4,000+ traded). Put activity was 6x the average daily volume. Management said last night that they see revenue per available seat down 3% this year. The … Read More »
Unusual Options Activity
BGC Partners (BGCP)- Another 2,500+ Aug $10 calls were sold for $0.25, against open interest of 23,553 contracts. There was selling in these yesterday. On May 6th, roughly 10,000 of these calls were sold as well. The large trader who built up this position in late 2014/early 2015 appears to be in the process of closing it out.
Bank of New York Mellon (BK)- A rollout from 2,500 June 19 $42 calls ($1.72 credit) into 1,700 July $44 calls ($1.00 debit) and 1,700 July $45 calls ($0.65 debit). The $49B global investments firm hit a new high early this morning.
DSW Inc (DSW)- 1,500 July $35 calls were purchased for $2.20-$2.45. Call activity was 4x the average daily volume. Q1 results are due out on May 27th (shares have moved higher after earnings on 3 consecutive reports). This morning, Sterne … Read More »
Weekend Market Update
Looking At Near-Term Upside Potential In The S&P 500
SPDR S&P 500 ETF Trust (SPY) Options Trade Ideas
Buy the (SPY) Mar 20 $210 call for $3.15 or better
Stop loss- $1.45
1st upside target- $6.00
2nd upside target- $8.00
Sell the (SPY) Mar 20 $204/$205 bull put spread for a $0.20 credit or better
(Sell the Mar 20 $205 put and buy the Mar 20 $204 put, all in one trade)
Stop loss reference- A move below $205 in the ETF
Upside target- $0.05 or less
Maximum gain potential- 25%
Notes: I’m long (BGCP) shares for $9.14 each and Aug $7.50 calls for $1.80 each.
Domtar Holdings (UFS) Options Trade Idea
Buy the (UFS) Apr $45/$50 … Read More »