Chicago Bridge & Iron has been pulling back hard, but
yesterday the buyers stepped in.
optionMONSTER's Heat Seeker scanners detected unusual activity in
the May 55 calls, with large blocks purchased for $1.40. More than
5,600 contracts changed hands, clearly new positions because open
interest in the strike was just 734 before the session began.
lock in the price where shares can be bought in the engineering
company. Their cheap price can give them significant leverage,
letting investors position for a rally at low cost. (See our
section for other risk-management techniques.)
CBI was down more than 1 percent when the calls hit but then
rebounded and closed up 0.17 percent to $52.64. The calls
appreciated some 10 percent to $1.55 from that small move.
Earnings come out May 2, and the last report beat on the top and
bottom lines. It's down more than 15 percent since late March, so
yesterday's traders were apparently looking for a bounce heading
into the next release.
Total option volume was twice the daily average in the session,
with calls outnumbering puts by more than 5 to 1.
(A version of this post appeared on
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