Watson Pharmaceuticals dropped on Friday, but the bulls saw it as a buying opportunity.
optionMONSTER's Heat Seeker monitoring program detected the purchase of about 4,600 December 65 calls, most of which priced for $1.15 to $1.50. Volume was more than twice existing open interest in the strike.
WPI ended the session at $63.42, down 1.75 percent. Shares are up 23 percent so far this year compared with an 8 percent drop for the S&P 500, but they have spent the last six months consolidating between $60 and $70.
The drug maker has beaten estimates for at last three straight quarters, fueled by the introduction of new generic drugs and strong demand for birth-control pills. The stock is now attempting to hold support at its 200-day moving average, which could be leading some chart watchers to think that it's still in an uptrend and will soon continue higher.
Overall option volume in the stock was 8 times greater than average in the session, with calls outnumbering puts by 10 to 1, according to the Heat Seeker.
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