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How one bull is staying in Safeway

Chris McKhann (chris.mckhann@optionmonster.com)

A large call trade tops today's option activity in Safeway as shares push higher.

optionMONSTER systems show that a trader sold 4,350 September 24 calls for the bid price of $2.30 against open interest of 7,236 contracts. Seconds later he or she bought 4,350 September 26 calls for the ask price of $1.45 in volume that was more than 10 times the previous open interest at that strike, clearly indicating new activity.

This could be a credit spread , which would be looking for SWY to fall below $24 by the expiration in mid-September, but it is more likely a call roll. In the latter case, the trader would be selling the in-the-money calls to close that position and buying the new out-of-the-money calls to continue positioning for more upside . (See our Education section)

SWY is up 2.84 percent to $25.35 in afternoon trading. The supermarket chain was down at support just above $22 at the start of the month but at highs above $28 a week before that.

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