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Cap seen on gains in Williams-Sonoma

Chris McKhann (chris.mckhann@optionmonster.com)

One trader sees limited up side in Williams-Sonoma as it sits in the middle of a relatively tight range.

More than 5,400 January 52.50 calls have traded today, led bt a big print of 3,800 that was sold for the bid price of $1.90, according to optionMONSTER systems. This is clearly new positioning, as open interest in the strike was just 9 contracts before the session began.

The calls were not tied to any trading in the underlying shares identified by our scanners today, so this could be naked selling with an initial bearish bias. But these options also could have been traded against an existing long stock position in a covered call strategy, which would be bullish up to the strike price but not beyond. (See our Education section)

WSM is up 1.22 percent to $45.56 this morning. The specialty retailer has been in a range between $43 and $48 since September, reaching a high of $48.07 in November.

optionMONSTER systems show that more than 6,200 WSM options have traded today, compared to the daily average of 1,050.

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