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Will U.S. Steel keep momentum?

David Russell (david.russell@optionmonster.com)

Someone expects the recent run in U.S. Steel to continue.

optionMONSTER's Heat Seeker monitoring program detected the sale of about 5,100 Weekly 27 calls that expired on Thursday, most of which priced for $0.37. A similar number 28.50 calls expiring at the end of this week were purchased around the same time for $0.21.

Volume was below open interest in the expiring contracts, which indicates that an investor rolled a long position forward by one week. He or she recovered about $0.16 of capital and remains positioned for further gains if X keeps on running.

Long calls lock in the price where the Pittsburgh-based steel maker can be bought. They let investors play a rally on the cheap, earnings huge leverage thanks to their relatively low cost. (See our Education section)

X rose 1.52 percent to $27.35 on Thursday and is up 20 percent in the last month. It's been coming back to life along with other metal companies as investors turn to an industry group that lagged the broader market in 2011 and 2012. Shares almost doubled in late 2013 but then stalled and drifted lower since the start of January.

Overall option volume was triple its daily average, according to the Heat Seeker, with calls accounting for a bullish 72 percent of the total.

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