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Buyers look for rebound in Energy XXI

Mike Yamamoto (mike.yamamoto@optionmonster.com)

One trader is betting that Energy XXI will be the next oil and natural-gas company to benefit from the sector's run higher.

optionMONSTER's Heat Seeker system detected the purchase of 1,250 April 32 calls in one print for $0.65. This is a new position, as open interest in the strike was just 182 contracts before the session began.

Energy XXI is down 1.53 percent to $30.25 this morning. The Bermuda-based company gapped down from above $34 after its last earnings report at the end of January but bounced at the $29 level this month.

Today's long calls , which lock in the purchase price for the stock no matter how high it might climb, are looking for EXXI to gain roughly 8 percent by mid-April. If the stock remains below the $32 strike price, however, those options will expire worthless. (See our Education section)

Overall option volume has reached 2,000 contracts so far today, about 40 percent more than its daily average in the last month. Calls are outpacing puts by more than 2 to 1. 

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