Buyers hope for gusher in FX Energy

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FX Energy has fallen more than 60 percent in the last eight months, but its shares surged with bullish option trading yesterday.

More than 2,000 September 5 calls were bought as premiums rose from $0.15 to $0.35. The volume was nearly double the strike's open interest of 1,118 contracts before the session began, indicating new activity.

FXEN soared 27.04 percent yesterday to $3.43 after reporting positive signs in early exploration at a key drilling site in Poland, where the company primarily operates. Shares closed at their 50-day moving for the first time since early March but are still a far cry from their 52-week high of $8.78 reached last September.

Yesterday's long calls , which lock in the price where traders can buy the stock no matter how far it might climb, are looking for shares to rally above $5 in the next five months. That would be a gain of another 50 percent, back to levels not seen since early November. (See our Education section)

Total option volume in the name exceeded 4,900 contracts yesterday, compared with a daily average of just 212 contracts in the last month. Calls outnumbered puts by more than 10 to 1, a reflection of the session's bullish sentiment.

The Salt Lake City-based oil and natural-gas company has not yet scheduled its next earnings report.

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