Late-day buyers charge into Apache

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Last-minute buyers piled into Apache calls yesterday, looking for a rally by the end of this week.

More than 5,000 Weekly 87.50 calls, which expire this Friday, traded in a strong buying pattern yesterday, according to optionMONSTER's Heat Seeker tracking system. Most of the action took place in the final 30 minutes of the session, led by a print of 3,566 that went for $0.16. These are clearly new positions, as the strike's open interest was just 352 contracts before the session began.

These long calls lock in the price where traders can buy the stock no matter how far it might rise. But the contracts will expire worthless if shares remain below $87.50. (See our Education section)

APA fell 1.04 percent yesterday to close at $84.79. The natural-gas and oil producer gapped up from below $79 on Friday after announcing that China's Sinopec will pay $3.1 billion for a 33 percent stake in the company's Egyptian operations.

The name was upgraded to "buy" from "neutral" by Japanese financial firm Mizuho on Monday, and Canaccord raised its price target for the stock to $113 from $106 yesterday.  

Total option volume in the name topped 18,600 contracts yesterday, double its daily average for the last month.


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