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Bulls return to Penn West Petroleum

David Russell (david.russell@optionmonster.com)

The bulls have made money in Penn West Petroleum, and they're looking for the gains to continue.

The Canadian energy company appeared optionMONSTER's Heat Seeker monitoring system on Friday, with about 4,600 of the April 10 calls purchased for $0.45 on Friday. Today a block of 4,600 of those calls traded for $0.90, while an equal number of May 10s were bought for $1.09.

This suggests that an investor exited a winning position from last week and rolled it forward in time. He or she paid $0.19 to make the adjustment and is effectively adding to the trade , which already doubled the money in the April contracts. (See our Education section for more on how options can be used to manage trades.)

PWE is up 0.37 percent to $10.87 in midday trading and up more than 8 percent since it first crossed the Heat Seeker last week. It lagged before that activity appeared, having fallen back near four-year lows, but the price action has been improving recently as it made a higher low than its trough in March. The options activity has been extremely bullish in the energy sector as well.

More than 10,400 contracts have traded so far, almost quadruple the daily average. Calls outnumber puts by more than 200 to 1.

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