U.S. Markets open in 54 mins.

Bears think Rock Tenn is boxed in

David Russell (david.russell@optionmonster.com)

Rock Tenn has been slowing, and now the bears are stepping in.

optionMONSTER's Depth Charge tracking program detected the purchase of 1,000 October 65 puts for $2.90 and the sale of an equal number of October 60 puts for $1.05. Volume was more than 15 times open interest at both strikes.

Known as a bearish put spread , the trade cost $1.85 and will earn a maximum profit of 170 percent if the packaging company closes at or below $60 on expiration. (See our Education Section for more on how to generate leverage using options.)

RKT fell 0.54 percent to $66.18 in morning trading. It peaked around $74 in March, then fell below $50 by early June. The stock has been rebounding since then, and has chalked up a 28 percent gain in the last three months.

The shares have been about flat in the last two weeks, however, which could make some traders expect a drop. A put spread would be an effective way to profit from such a move.

Overall option volume is 12 times greater than average so far today, with puts accounting for all the activity so far.

More From optionMONSTER