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Vote of confidence in Hansen Medical

By: optionMONSTER
Posted: 12/12/2011 3:48:00 AM
Referenced Stocks: HNSN

Hansen Medical ripped higher on Friday, and one investor is confident there's no going back.

optionMONSTER's tracking systems detected the sale of 4,000 June 2.50 puts for $0.70 against open interest of just 180 contracts. If HNSN stays above $2.50 through expiration, the trader will keep the credit and the puts will expire worthless.

Below that level, the put seller would be forced to buy shares. But including the credit generated, the effective entry price would be $1.80. (See our Education section)

HNSN, whose revenue is growing at about 50 percent annually, rose 15 percent to $2.62. The small-cap maker of robotic surgical devices has been on a wild ride, ripping from $1.30 to $5 between December 2010 and July, and then proceeded to lose half its value.

Friday's surge came amid a rally in the broader market and after the company announced that it had obtained a $30 million bank line. The shares also seem to have found support around the same $2 that was resistance late last year, which some chart watchers may consider evidence of a bullish uptrend.

Overall option volume was 42 times greater than average in the session.