Ancestry.com has pulled back after ripping higher, and the
bulls are stepping in.
optionMONSTER's Heat Seeker monitoring system detected the
purchase of 2,500 October 30 calls for $2.85 and the sale of an
equal number of October 35 calls for $0.75. Volume was above open
interest at both strikes, indicating a new position was
It cost $2.10 to open and will earn a profit of 138 percent if
the stock closes at or above $35 on expiration. The strategy is
known as a
bullish call spread
because it will leverage a move between two prices. (See our
ACOM rose 2.61 percent to $31.03 in afternoon trading and is up
about 30 percent in the last three months. The provider of
family-history data has been rallying amid takeover speculation,
and exploded higher on July 25 after quarter results beat
expectations. Management also raised full-year guidance.
It surrendered some of those gains in the last week, but quickly
bounced after finding support at its 50-daymoving average. That
could make some chart watchers think the uptrend remains intact.
Overall option volume is 5 times greater than average so far in
the session, according to Heat Seeker. Calls outnumbered puts by
a bullish 13-to-1 ratio.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.
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