Traders are betting that the New York Times Company will break above a key resistance level in coming weeks.
More than 2,100 May 10 calls traded in a strong buying pattern yesterday, all but a handful of them going for $0.40, according to optionMONSTER's Heat Seeker system. The volume was well above the strike's open interest of 1,288 contracts before the session began, indicating new activity.
NYT rose 2.77 percent yesterday to close at $10, bringing the stock back near a March resistance level that had been in place since October. The newspaper publisher is up more than 50 percent in the last year but has been trading mostly sideways for the last six months.
The calls bought yesterday, which lock in the price where traders can purchase the stock, are looking for NYT to climb above $10.40 before they expire in mid-May. These options will closely track the share price because they are now in the money . (See our Education section)
The action follows bullish call buying at the October 10 strike detected by the Heat Seeker on March 27.
The company has struggled to reverse decade-long declines in circulation and revenue but has reported some success with new ways to charge for digital content. Management is scheduled to report first-quarter results on April 25 and will hold the company's annual shareholder meeting on May 1.
Overall option volume in the name yesterday was 60 percent higher than its daily average for the last month. No puts changed hands in the session, a reflection of the day's bullish sentiment.
More From optionMONSTER
- Trader doesn't want Clorox to get away
- Videocast: VIX pits draw line in sand
- Huge volatility trade targets gold fund
- Investment & Company Information