Range-bound play in LyondellBasell

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One trader apparently thinks that LyondellBasell Industries is going nowhere in a hurry.

optionMONSTER's tracking programs detected the sale of about 2,800 contracts each in the September 55 puts for $2.15 and the September 70 calls for $1.40. That amounts to a total credit of $3.55.

The investor will keep that amount as profit if the chemical stock remains between $55 and $70 through expiration. Gains will erode outside that range, turning to losses below $51.45 and above $73.55. (See our Education section for more on the strategy, known as a short strangle .)

LYB rose 1.22 percent to $62.30 yesterday. The chemical company rallied more than 40 percent in the second half of 2012 but has been swinging in a range since. It made a lower low in April than in February and now appears to have made a lower high. That could be leading some chart watchers to think that it's losing momentum and to support a neutral view.

Yesterday's total option volume in the name was triple its daily 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: LYB

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