Express is starting to show bullish signs, and one investor is
positioning for a rally.
optionMONSTER's Heat Seeker tracking system detected the
purchase of about 1,600 December 15 calls for $0.85 to $0.91. A
similar number of December 12.50 calls was sold at the same time
for $2.68 against existing open interest, which indicates that a
long position was rolled to the higher strike.
The trade let the investor recover about $1.75 of premium while
providing an opportunity to make money if the women's clothing
chain continues to rally.
EXPR rose 2.48 percent to $15.26 yesterday. The company is
scheduled to issue results after the bell Wednesday, marking only
its second earnings release as a public company. Its last report on
Sept. 1 was better than expected, fueled by a 6 percent gain in
The stock has been showing potentially bullish technical patterns,
making successively higher lows since September and consolidating
above its 50-day moving average (black line on chart). It has also
lagged amid strength in the broader retail sector.
Given that the last earnings report was positive, the investor who
rolled the calls probably expects more good news this week. The
activity pushed total option volume in EXPR to 38 times greater
than average, with calls accounting for a bullish 98 percent of the
(Chart courtesy of tradeMONSTER)
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