One investor still has a glimmer of hope in Cree.
optionMONSTER's Heat Seeker tracking system detected unusual call
volume in the maker of light-emitting diodes, which is up 36
percent in the last six months. Some 5,000 January 35s were sold
for $0.05 against previous open interest, indicating that an
existing long position was closed.
Hardly a minute later, about 4,700 February 35 calls were bought
for $0.65. Given their similar size and timing, it appears the
investor closed an existing position in the January contracts and
rolled it forward in time. He or she now has an additional month to
profit from a rally in the share price.
CREE fell 0.78 percent to $31.81 yesterday. The stock peaked over
$80 in April 2010 before retreating all the way to $20 by late
2011. It's been climbing since then as quarterly results start to
improve.
The next earnings report is scheduled for Jan. 22 after the bell,
so yesterday's trade adjustment allowed the investor to remain long
through that release. (See our
Education
section for more on how options can be used to manage portfolio
positions.)
Almost 16,000 contracts traded in the session, more than triple the
daily average, according to the Heat Seeker. Calls accounted for a
bullish 86 percent of the total.
