Pitney Bowes has broken a long-term resistance, and option
traders are betting that it will keep ripping higher.
optionMONSTER's Heat Seeker tracking program detected the purchase
of 5,000 January 30 calls for $1.80 and the sale of 5,000 January
25 calls for $3.80. Volume was below open interest at the lower
strike, which suggests that a long position was closed and rolled
to the higher strike.
lock in the price where a stock can be bought, letting investors
cheaply position for gains while limiting the amount of capital at
risk. They can also generate significant leverage if a rally
ensues. Rolling to the January 30s allows the trader to receive a
credit of $2 while keeping him or her exposed to further gains.
PBI fell 0.22 percent to $26.98 on Friday and is pushing above its
previous highs from 2010 and 2011. Traditionally a maker of
snail-mail postage meters, the company has been reinventing itself
as a provider of communications products and services. The stock
has more than doubled since bottoming near $10 early last year.
Overall option volume was 8 times greater than average in the
session, with calls accounting for a bullish three-quarters of the
(A version of this post appeared on
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