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Puts position for Exelon to lose power

Mike Yamamoto (mike.yamamoto@optionmonster.com)

Exelon has been struggling to climb off its lows for the year, and one large trade is positioning for another potential drop.

optionMONSTER's systems show that 5,000 January 28 puts were purchased for $0.15 at the same second near the end of Friday's session. The volume was nearly 6 times higher than the strike's open interest at the start of the session, clearly indicating that this is a new position.

The puts weren't tied to any stock trading identified by our systems on Friday, though they could have been bought to protect a long position established earlier. Alternatively, the options could be making a straight bearish bet that EXC will fall roughly 7 percent or more by expiration in mid-January.

EXC slipped 0.23 percent on Friday to end the week at $29.88, continuing to face resistance around the $30 level and disappointing bullish option traders along the way. The electricity-generation company fell hard from above $36 after its earnings report early last month and hit a 52-week low of $28.40 on Nov. 23.

Total option volume in the name was 9,323, almost double its daily average for the last month. Puts outnumbered calls by 6 to 1.

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