Noble Energy draws call buying
Traders are looking for Noble Energy to continue recovering from sharp losses earlier this summer.
More than 3,600 September 74 calls were bought for $0.30 to $0.45 on Friday,
optionMONSTER's Heat Seeker tracking system shows. The volume was well above the strike's previous open interest, indicating that new positions were established.
These long calls lock in the price where the stock can be purchased through mid-September 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 $74. (See our Education section)
NBL rose 1.72 percent to $72.14 on Friday, closing only $0.02 off its session high reached just before the bell. The oil and natural-gas producer fell below $67 after missing revenue estimates and lowering guidance in late July, but the stock has been working its way higher since then and is just below its 50-day moving average.
Total option volume in Noble Energy surpassed 6,200 contracts, 8 times its daily average for the last month. Only 264 of those were puts, a reflection of the day's bullish sentiment.
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