Fifth & Pacific is back near long-term resistance, and one
investor is looking for a breakout.
optionMONSTER's Heat Seeker monitoring program detected the
purchase of 15,000 October 14 calls for $0.65 and the sale of an
equal number of October 13 puts for $0.45. Volume was more than 27
times open interest at both strikes.
The position cost $0.20 to open and is highly leveraged to upside
in the apparel company. While similar to owning shares, the
performance profile differs because it will track the stock less
close as time passes and expire worthless if FNP remains between
$13 and $14 through expiration six weeks from now.
FNP is up 0.85 percent to $13.75 in afternoon trading and is back
near the $14 level that stood as a barrier in the spring. Based on
today's option trade, they're looking for that resistance to yield
and the stock to run.
The shares are already up more than 40 since late July, when the
quarterly revenue beat expectations amid strong performance at its
Kate Spade retail stores. Formerly known as Liz Claiborne, FNP has
been shifting its focus toward the high-end brand to counter
weakness at Juicy Couture.
Overall option volume in the name is more than 160 times greater
than average so far today, with that bullish combination trade
accounting for almost all the activity.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.