Maybe the world hasn't ended for Celsion after all.
The developer of cancer drugs got hammered in late January,
cratering from over $8 to less than $1 after announcing that its
lead compound failed in a late-stage trial. Its shares ground
sideways for months after the news but have been rallying in the
Then yesterday it added another 39 percent to $1.59, and call
buyers were all over the stock.
optionMONSTER's Heat Seeker monitoring program found especially
heavy activity in the January 1.50s for $0.25 and $0.30. More than
13,000 contracts changed hands, almost quadruple the previous open
interest at the strike, indicating that these are new positions.
Those trades locked in a $1.50 purchase price on the company
through early next year no matter how far it might climb by then.
Given the cheapness of the calls, they could provide
if the stock rallies. For instance, a return to $3--a double in the
stock price--would result in profits of some 500 percent. Using the
calls also limits the amount that traders can lose if it drops.
section for more on how to manage risk with options.)
It's not clear what triggered the recent buying, but the company
announced receiving more patents related to its drug, ThermoDox.
One writer following it at
, who accurately predicted the current run-up, attributes the move
to a short squeeze or potentially positive news.
Overall option volume was 25 times greater than average in CLSN
yesterday, with calls accounting for a bullish 95 percent of the
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