Once again, the bulls are coming back to Delta Air Lines.
The stock is already up 45 percent this year, and has given call
buyers winning trades time and time again. Just
, for instance, our Heat Seeker monitoring program detected blocks
of the May 17s changing hands for $0.33. Those contracts have more
than doubled to $0.75 since then.
The Heat Seeker shows much longer-term positioning today, but the
sentiment remains bullish. This time a block of 5,000 January 2015
20 calls was bought for $2.78. Volume is more than 12 times
previous open interest at the strike.
have locked in a $20 entry price on DAL over the next 19 months, no
matter how high the stock may fly. The trader may wish to leverage
a move or may be using the contracts to make sure it doesn't run
away before he or she has the capital to buy the stock outright.
section for more on how options can be used to manage trades.)
DAL is up 3.74 percent to $17.47 in afternoon trading and is the
best-performing member of our
this year. The company took the unusual step of buying an oil
refinery a year ago and has benefited from that move as fuel prices
rose and refinery stocks rallied. Fares have been going up as well,
which let profit beat expectations on April 23 despite revenue
missing consensus by a narrow margin.
Total option volume is still below average in the name today, but
calls outnumber puts by a bullish 13-to-1 ratio.
Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.