Bulls see gusher in Goodrich Petroleum

Mike Yamamoto (mike.yamamoto@optionmonster.com)

One trader apparently believes that Goodrich Petroleum will break through a key upside level and rally hard this year.

optionMONSTER's Heat Seeker system shows that 1,500 September 20 calls were bought in less than a minute today, mostly for $0.99. Open interest in the strike was just 103 contracts before the session began, so this is clearly a new position.

GDP is off 0.61 percent today at $14.59, not far from resistance at the $15 level that goes back to May 2012. The oil and natural-gas company is scheduled to present at the Howard Weil Energy Conference on March 19.

Today's long calls , which lock in the purchase price for the stock regardless of how far it might rise, are looking for a gain of no less than 44 percent by mid-September. Those options can be sold earlier at a profit if their value rises with any rally before then, but they will expire worthless if GDP stays below the $20 strike price. (See our Education section)

Total option volume in the name is nearly 50 percent higher than its daily average. Calls outnumber puts by more than 10 to 1.


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