Tone turns bearish as FedEx struggles

By
A A A

FedEx is struggling, and traders are nervous.

optionMONSTER's Depth Charge tracking program detected the purchase of 4,000 October 70 puts for $1.86 and the sale of an equal number of October 60 puts for $0.72. Volume was more than 7 times open interest at both strikes.

Known as a bearish put spread , the trade cost $1.14 and will earn a maximum profit of 777 percent if the shipping stock closes at or below $60 on expiration. It hasn't seen that level since mid-2009.

FDX is up 1.65 percent to $88.06 in afternoon trading but has been trending downward since mid-February. It's been making lower lows and lower highs and has yet to recover from a sharp drop after its last earnings report on March 22. The stock is also below its 100-day moving average for the first time this year, which some chart watchers may consider a bearish sign.

Overall option volume in FDX is slightly above average so far today, with puts outnumbering calls by a bearish 3-to-1 ratio.



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: FDX

optionMONSTER

optionMONSTER

More from optionMONSTER:

Related Videos

Budgeting for Baby
Budgeting for Baby                  
A Home to Retire In
A Home to Retire In                 

Stocks

Referenced

69%

Most Active by Volume

11,180,259
  • $17.0101 ▼ 0.23%
9,270,788
  • $13.73 ▼ 3.24%
9,118,884
  • $14.685 ▼ 0.71%
9,050,074
    $17.15 unch
7,890,780
  • $97.96 ▼ 0.84%
6,760,799
  • $99.83 ▼ 0.91%
6,556,358
  • $3.39 ▲ 4.31%
6,466,576
  • $25.18 ▼ 1.72%
As of 10/1/2014, 10:01 AM

Find a Credit Card

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