Intel is approaching its highs of the year, and traders are positioning for another pop in coming days.
optionMONSTER's Heat Seeker system detected the sale of 7,000 December Weekly 25 calls that expire tomorrow for the bid price of $0.56 and the purchase of 7,000 January Weekly 25.50 calls that expire at the end of next week for the ask price of $0.30. Volume was below previous open interest in the December contracts, indicating that an existing long position closed and rolled forward by a week to a strike that is $0.50 higher.
The new long calls lock in a $25.50 purchase price for the stock through next Friday, Jan. 3, no matter how far it might climb. But the contracts will expire worthless at that time if shares remain below that level. (See our Education section)
INTC rose 0.43 percent to $25.43 on Wednesday, near its 52-week high of $25.98 reached in early June. The chip maker's shares have been gaining steadily since bouncing at the $24 level two weeks ago.
Total option volume in Intel topped 75,000 contracts, 45 percent higher than its full-day average for the last month, despite the truncated session. Overall calls eclipsed puts by nearly 4 to 1.
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