Micron draws long-term bearish bet
Micron Technology is bouncing off its lowest close since the beginning of 2012, but one trader is taking a huge downside position in the chip maker.
MU fell 2.23 percent to finish the day $7.11, one session after seeing its lowest close since Jan. 3. Shares have been sliding for weeks, having retested resistance near the end of March.
Yesterday's option volume was dominated by the action in the January 2014 10 puts, according to optionMONSTER's Depth Charge system. A trader bought 25,000 of those contracts for $4 against previous open interest was just 304, so this was a new opening position.
The put buying is very likely an outright bearish play rather than a protective hedge on a long position. Traders often use in-the-money puts instead of shorting the shares to play the downside but limit the risk if the stock rises sharply. (See our Education section)
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