Compuware is stalling at a long-term resistance level, and one
investor is apparently throwing in the towel.
optionMONSTER's tracking programs detected the sale of 5,200
February 10 calls for $0.80 against open interest of 2,519
contracts. Total option volume in the software stock is 36 times
greater than average so far in the session.
CPWR is down 1.54 percent to $10.26 in late morning trading, one
day after hitting a 14-month high of $10.48. The company's earnings
and revenue beat forecasts the last time it issued results on Oct.
22. The stock exploded higher on that news and has been slowly
grinding upward since.
Shares are now pushing against the same level where they traded
immediately before the late-2008 market crash. Some chart watchers
may expect resistance in this price area.
Today's option trade was probably the work of an investor who owns
CPWR shares and expects them to pull back. Writing calls obligates
the trader to sell the stock at $10 if it closes above that level
on expiration. (See our Education section)
Including the premium earned, the transaction effectively locked in
an exit price of $10.80 on the stock.
(Chart courtesy of tradeMONSTER)
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