I'm surprised we didn't see a spike up in option OI showing the recent bump up. There is a lot more to come based on the options action.
The DEA issue will be fully decided by then for sure.
Right?
This is too easy. Buying on these dips makes it easy to scoop up some extra profit$.
Funny thing about this dip today. The options didn't dip nearly as much, indicating that is is a momentary / false dip that will quickly rebound.
You should be safe as the news may very well not hit until right after option expiration. Even if it does hit early though, $45 could be it on the upside, and you'll get all the capital appreciation as well. If I had to forecast, options will expire worthless and then the announcement will hit & you'll get the best of both worlds.
How many PUT contracts did you buy, and what strike & expiration please?
I'm saying that the call option volume indicates that a sharp upward move is expected earlier rather than later. Therefore, it stands to reason that the FDA meeting already happened and EU are preparing the paperwork now for AA.
Please allow me clarify. While yes, someone must sell the call option in order for the other to buy it, the real value is in the ratio of puts to calls. Since 80%+ of all options expire worthless, that is the telling comparison.
To your point though, the option premium is also a factor, and with the call option (at the money) running at about 15%, that is another very bullish sentiment.
The only ones who know if they truly have met yet are the I side execs at the company & FDA. If you are one of those, you can't disclose it. If you are not, then you are just guessing.
You can see the open interest for yourself. There is more than 3x as many call options open than put options for March. May is a similar story.
This will easily refute any basher's claim that options are bearish.
They may have ALREADY met with the FDA about accelerated approval. I see more than 30,000 contracts open interest for March Call Options which controls 3M shares which would cover 3/4 of the short position which could indicate at we get information sooner rather than later about AA and at it will be positive news. Positive because there is a disparity of Call options compared with Put options.
It stands to reason that comparing the March Calls open interest with April, the much larger OI in March, which expires soon, could represent that the Street already knows. Of we see a significant rotation into the April options (half the March OI) then it could be delayed until end of March beginning of April time frame.
There is another increase in May options, about 50% more than April OI, which could indicate that the shorts are lining up call options to hedge against their short position.
Very strange option OI pattern indeed. Lets see if this plays out in support of my theory.
This stock is GUARANTEED to rocket upwards, as I just sold the covered call on shares I hold. Now watch it double overnight!