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Bulls seek their roots with Ancestry.com
Ancestry.com has pulled back after ripping higher, and the
bulls are stepping in.
optionMONSTER's Heat Seeker monitoring system detected the purchase of 2,500 October 30 calls for $2.85 and the sale of an equal number of October 35 calls for $0.75. Volume was above open interest at both strikes, indicating a new position was initiated.
It cost $2.10 to open and will earn a profit of 138 percent if the stock closes at or above $35 on expiration. The strategy is known as a bullish call spread because it will leverage a move between two prices. (See our Education Section .)
ACOM rose 2.61 percent to $31.03 in afternoon trading and is up about 30 percent in the last three months. The provider of family-history data has been rallying amid takeover speculation, and exploded higher on July 25 after quarter results beat expectations. Management also raised full-year guidance.
It surrendered some of those gains in the last week, but quickly bounced after finding support at its 50-daymoving average. That could make some chart watchers think the uptrend remains intact.
Overall option volume is 5 times greater than average so far in the session, according to Heat Seeker. Calls outnumbered puts by a bullish 13-to-1 ratio.