One trader is looking for JinkoSolar to shine in coming weeks.
optionMONSTER's Heat Seeker system detected the purchase of 2,000 August 30 calls for $1.15 at the same second on Friday. Open interest in the strike was just 352 contracts before the session began, showing that this is a new position.
These long calls lock in the price where the stock can be purchased by mid-August no matter how far it might climb. They could be sold earlier at a profit if premiums rise with a rally before then, providing potentially significant leverage, but the contracts will expire worthless if shares remain below $30 for the next month. (See our Education section)
JKS rose 2.77 percent on Friday to close at $26.75. The Chinese solar-technology stock has doubled in the last year but is down sharply since hitting long-term resistance at the $37 level in early March.
The company has not yet scheduled its next earnings report, but last year's calendar suggests that quarterly results will come out right around the August option expiry.
Friday's total option volume in JinkoSolar was nearly triple its daily average for the last month. Overall calls outpaced puts by 9 to 1, a reflection of the session's bullish sentiment.
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