Bulls returning to Activision Blizzard
For the second day in a row, Activision Blizzard is drawing upside bets.
optionMONSTER's Heat Seeker monitoring program detected the purchase of 3,300 November 26 calls for $1.23. Volume was more than 7 times open interest at the strike, which indicates new money was put to work.
Long calls lock in the price where a stock can be bought. They closely track the underlying shares, which prevents investors from missing a rally, while their cheap cost helps limit risk and can generate significant leverage. (See our Education section)
ATVI is off 0.64 percent to $24.66 in afternoon trading but is up 22 percent so far this year. The video-game maker has benefited from a transition to Internet-based sales and new consoles. Earnings and revenue both beat expectations on May 6, which propelled the stock over $26 for the first time ever by early June.
It's pulled back in the last month and is now trying to rally from a dip below its 50-day moving average. Yesterday momentum traders bought July 24.50 calls in hope of a rally. Earnings are due on Aug. 4.
Total option volume is twice the daily average so far today, with calls outnumbering puts by 5 to 1.
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