Trade sees a bottom for Lululemon

optionMONSTER

A bullish combination is looking for some bounce from Lululemon Athletica as the shares stabilize.

More than 16,000 LULU contracts have traded so, almost twice the average volume in the last month. optionMONSTER's systems show that a January 2014 combination dominate the action. A trader bought 4,000 of the 62.50 calls for $8.73. At the same time, they sold the same number of the 72.5 calls for $4.66 and the 50 puts for $3.52.

The strategy combines elements of a bullish call spread with put selling to provide upside exposure at a cost of just $0.55. The risk is that they face potential losses to the downside on a drop below $50. (See our Education Section .)

LULU rose 0.30 percent to trade at $62.54 in morning trading. It was above $70 two weeks ago before warning that it was suspending shipment of yoga pants because they were too transparent.



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