Astex Pharmaceuticals has lost a third of its value since hitting a multi-year high six weeks ago, but one large trader apparently believes that the slide is ending.
optionMONSTER's tracking systems detected the sale of 5,000 July 4.50 puts in a single print for $0.32 yesterday. This is clearly a new position, as the strike's open interest was just 331 contracts before the trade appeared.
The put seller is looking for the ASTX to stay above the $4.50 strike price through expiration in mid-July. If it drops below that level, the trader will be on the hook to buy shares at an effective price of $4.18 once the credit from the put sale is included. (See our Education section)
ASTX rose 2.41 percent yesterday to $4.68. The drug developer peaked at $6.95 leading up to its last earnings report at the end of April--its highest price since April 2007--but fell sharply after the release and has been drifting lower since.
Total option volume in the name yesterday topped 6,400 contracts, nearly double its daily average for the last month.
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