Silicon Laboratories fell hard last month, and traders are
positioning for more downside.
optionMONSTER's Depth Charge monitoring system detected the
purchase of more than 4,000 October 35 puts for $3.68 to $4. Volume
was almost 16 times open interest in the strike.
SLAB is up 0.56 percent to $34.03 in afternoon trading but has lost
more than one-quarter of its value in the last three months. Most
of that drop occurred on April 25 after the company said it might
exit the market for smart-phone touch controllers because of
The shares have been staggering since that selloff, and today's
puts were bought near the peak of the session. The trader
apparently thinks that they're making a lower high and are now due
for another push to the downside.
He or she is using
contracts, which have a strong negative correlation to the stock
price. (See our
Overall option volume in SLAB is more than 20 times greater than
average so far today, according to the Depth Charge. Puts outnumber
calls by more than 900 to 1.
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