SAIC reached its highest level in 18 months yesterday, and one trader is looking for the rally to continue.
optionMONSTER's Heat Seeker system detected the sale of 6,000 May 13 calls for $0.75 and the purchase of 6,000 August 14 calls for $0.55 and $0.60. Volume was below the previous open interest in the May contracts and above it in the August options, suggesting that a long-call position was being rolled forward.
This keeps the investor in the trade for another three months while raising the the strike price by $1, a reflection of the stock's recent gains. The new long calls , which lock in the price where shares can be purchased, are betting that shares will be above $14 by expiration in mid-August. (See our Education section)
SAI was up 0.51 percent to $13.85 yesterday, its highest close since August 2011. The security-technology company has been rising since trading near $11 in late February, gapping higher after its fourth-quarter earnings report on March 26.
Total option volume in the name was about 14,000 contracts, 8 times its daily average for the last month. Only 171 puts changed hands in the session, a reflection of the day's bullish sentiment.
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