Markets

Bears want more blood from Eaton

The bears want another pound of flesh from Eaton.

optionMONSTER's Depth Charge tracking program detected the purchase of 2,300 December 40 puts for $1.42 to $1.60 and more than 1,700 December 35 puts, most of which priced for $0.40. Roughly 1,100 December 45 puts were sold at the same time for $4.43 to $4.66.

Volume was more than twice open interest in the 35s and 40s but below open interest in the 45s. This suggests that an investor had made money on the higher-strike puts and is now rolling a position to the lower strikes in hopes that the industrial stock will continue to fall.

ETN dropped 0.78 percent to $40.55 on Friday and has lost 12 percent of its value since mid-November. Shares rallied along with the rest of the market in October, only to run out of steam and push lower this month.

Overall option volume in the name was more than 4 times greater than average in the session, with puts accounting for 75 percent of the activity.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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