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Call seller sees ceiling in Gold Fields

Chris McKhann (chris.mckhann@optionmonster.com)

Shares of Gold Fields are trying to rebound after a steep selloff in recent months, but one large trader sees only limited upside for the South African mining company.

Almost 9,000 October 8 calls have traded against previous open interest of 4,156 contracts, indicating new activity, according to optionMONSTER systems. The biggest block of 8,010 was sold for the bid price of $0.41.

The calls don't appear to have been traded against the underlying shares, so this could be naked selling with an initial bearish bias. Alternatively, the options could have been sold against a previously established long position in as a covered call position, which would be bullish up to the $8 strike price but not beyond. (See our Education section)

GFI is up by a penny at $7.17 in midday trading after hitting a low of $6.83 last week. Shares were above $8 three weeks ago as they came down from above $12 in mid-February.

optionMONSTER systems show that more than 10,700 GFI options have traded this morning, compared to a daily average of 659.

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