For the second session in a row, the bulls are targeting
optionMONSTER's Heat Seeker tracking system detected the purchase
of about 3,200 May 18 calls for $1.15 and the sale of an equal
number of May 18 puts for $1.08. Volume was more than 4 times open
interest at both strikes.
The trade cost about $0.07 and will mimic owning shares in the
Luxembourg-based steelmaker. They will earn quick leveraged gains
if it rallies and face losses of a similar magnitude to the
downside. (See our
, almost 20,000 January 2014 20 calls were bought for $2.95 in hope
that MT will power climb over the next 21 months. Those contracts
are now quoted at $3.10 with the stock higher today.
MT is up 4.76 percent to $18.28 in afternoon trading but is still
down about 49 percent in the last year. Most steel makers and
related companies, such as coal miners and copper producers, have
underperformed since last summer's market crash as investors worry
about sovereign debt problems in Europe and slower growth in China.
The now stock appears to be holding long-term support after
bouncing at its lowest level since mid-December earlier this week.
Overall option volume is more than twice the average amount so far
today, according to the Heat Seeker.
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