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Large trade targets new highs for Yelp

David Russell (david.russell@optionmonster.com)

Traders apparently think that there is no stopping social network Yelp.

optionMONSTER's Heat Seeker monitoring system detected the purchase of about 7,700 November 40 calls for $3.71 and the sale of a matching number of August 34 calls for $4.51. Volume was below open interest in the 34s, indicating that an existing position was closed and rolled to the higher strike.

The investor collected a credit of $0.80 making the adjustment. The new long calls provide the trader with an additional three months to profit from upside in the company, which features community reviews of local businesses. (See our Education section for more on how to manage trades with options.)

YELP is down 2.28 percent to $36.39 this afternoon but is up 93 percent since the beginning of January. Its last quarterly report beat expectations on the top and bottom lines, fueled by growth in the mobile and local advertising markets. The shares also benefited from a short squeeze earlier in the year.

Total option volume is 7 times greater than average in the name so far today, according to the Heat Seeker. Calls outnumber puts by a bullish 14-to-1 ratio.

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