Cameron International has been stuck in a range ahead of
tomorrow's earnings report, but one investor still expects a rally.
optionMONSTER's Heat Seeker monitoring program detected the
purchase of about 9,900 March 60 calls for $1.85. A similar number
of February 60 calls were sold at the same time for $1.15 against
previous open interest. That suggests an existing position was
closed and rolled forward in time at a cost of $0.70.
Long Calls lock in the price where shares can be purchased,
providing cheap upside exposure for a specified period of time.
Today's adjustment gave the investor an additional month to profit
from a rally while protecting him or her from the quickening pace
that will occur heading into February expiration. (See our
CAM is down 1.18 percent to $56.87 in afternoon trading. The
oil-servicing stock spent most of the last year between $55 and $65
but has been trying to fight its way back from a big selloff in
October. That drop resulted from a poor earnings report, and the
company's next release is scheduled for tomorrow morning.
Total option volume is quadruple the daily average so far in the
session, according to the Heat Seeker. Overall calls outnumber puts
by a bullish 8.5-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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