Bulls want to ride Abercrombie higher
Abercrombie & Fitch is sitting at support, and the bulls are getting long.
optionMONSTER's Heat Seeker monitoring system detected the purchase of 2,500 November 60 calls, most of which priced for $1.41, and the sale of an equal number of November 41 puts for about $1.89. Volume was more than 37 times open interest at both strikes, indicating that new positions were initiated.
The investor collected a credit of $0.48 and now stands to earn unlimited profits with the long calls if the retailer rallies toward $60 by later this year. He or she also stands to lose money to the downside because of the short puts . (See our Education section)
ANF is up 0.76 percent to $49.13 in midday trading and has been spent most of the year consolidating between $45 and $52. It's also holding support at the 100-day moving average, which some chart watchers could view as evidence of a bullish uptrend.
The upside trade pushed overall option volume in the name to almost twice the daily average, according to the Heat Seeker.
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