Sprint Nextel is climbing to its highest levels since August, but a huge call sale apparently sees a cap on further gains.
S is up 0.82 percent to $3.68 in afternoon trading. The telecom carrier has been on a run since late May, when it traded near $2.30.
The option volume of 35,000 contracts today is 3 times its daily average. Topping that action are the 22,000 August 4 calls sold for the bid price of $0.11, including three large prints of 12,500, 5,000, and 2,500 that traded in less than a minute, according to optionMONSTER's systems. Open interest in the strike was 8,859 contracts at beginning of the day, so this is new activity.
These options were likely sold done against long shares in a covered call position. That trade would take a maximum gain with S at or above $4 at expiration but would not see further gains with the stock above that strike price. (See our Education section)
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