Investor sees resistance in Micron

By
A A A

Micron Technology has been explosive, but one big investor sees resistance on the chart in the long term.


optionMONSTER's tracking programs detected the sale of some 26,000 January 2015 12 calls for $1.89 to $1.91. Volume surpassed previous open interest of 19,059 contracts, indicating that a new position was initiated.

Writing calls locks in the price where the investor must sell shares in the maker of computer-memory chips. He or she probably owns the stock and is using the options as part of a covered call trade, a common strategy that reduces volatility .

It's noteworthy that the investor chose the $12 level, because that's the same area where the stock rolled over in early 2011. So today's trader seems to think that resistance will hold in the long run. (See our Education section for more on how options can be used to target key price levels and time price swings.)

MU is up 0.74 percent to $10.79 this afternoon and 70 percent since the beginning of the year. Profit missed expectations the last time results came out in March, but a strong revenue number gave investors confidence that demand was growing.

Today's call selling pushed total option volume in MU to almost 5 times greater than average.



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.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.



This article appears in: Investing , Options

Referenced Stocks: MU

optionMONSTER

optionMONSTER

More from optionMONSTER:

Related Videos

Stocks

Referenced

87%

Most Active by Volume

124,429,622
  • $47.87 ▲ 10.45%
86,937,934
  • $9.99 ▲ 6.28%
74,401,985
  • $7.92 ▲ 11.24%
43,464,235
  • $59.64 ▲ 0.69%
42,148,695
  • $130.28 ▲ 0.47%
41,471,941
  • $34.01 ▼ 0.64%
40,701,089
  • $11.99 ▼ 8.75%
39,983,675
  • $15.64 ▼ 0.32%
As of 4/24/2015, 04:15 PM


Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com