Dish Network has been taking a pause, but traders are looking for the next leg higher.
optionMONSTER's Heat Seeker monitoring program detected the purchase of about 10,000 September 57.50 calls for $5.15 and the sale of a matching number of June 57.50 calls for $2.05. Volume was below open interest in the nearer-dated contracts, which indicates that an existing position was closed and rolled forward in time. Making the adjustment cost $3.10 and provides an additional three months of upside exposure to the satellite-media company.
Long calls lock in the price where investors can buy a stock, letting investors cheaply position for a move higher. In the case of today's Dish trade, it's noteworthy that they're using high-delta contracts that are in the money . (See our Education section)
DISH is down fractionally to $58.94 in afternoon trading. It's roughly doubled in the last two years and is consolidating at its highest levels since the tech bubble broke in 2000. The shares have been pausing around $60 in recent months, and today's transaction gives the investor more time for them to resume their uptrend.
Overall option volume is 10 times greater than average so far today, with calls accounting for a bullish 71 percent of the total.
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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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
