A trader bought 4,304 HP Jan 80 Calls for $2.10 (6.8 times usual volume) with stock at $77.44
A trader bought 11,325 MJN Dec 70 Puts for $0.41 (8.2 times usual volume) with stock at $80.63
A trader bought 10,000 YNDX Dec 38 Calls for $1.50 (5 times usual volume) with stock at $36.82
A trader bought 2,900 VCRA Jan 20 calls for $0.60 (2.7 times usual volume) with stock at $16.95
A trader bought 26,000 LOW Dec 44 Puts for $0.205 (7.6 times usual volume) with stock at $51.70
Author: Andrew Keene
Stock Swing Trade of the Day: VCRA
Vocera Communications, Inc (VCRA) provides mobile communication solutions through both voice communications and messaging solutions. The company’s stock is currently trading around $17.15 in a 52 week range of $11.99-$29.47. The stock has been under performing the market this year with shares losing over 30% year to date. Despite this weakness options traders have been placing large bets on further upside in VCRA. Early in today’s session a trader bought 2,900 VCRA Jan 20 calls for $0.60. This block represents volume in 2.7 times the average daily option volume in VCRA. This bullish bet adds to activity we saw earlier this week when a trader bought 1,800 VCRA Dec 20 calls for $0.30. The VCRA chart is relatively neutral but the huge amount of upside call buying we’ve been seeing is more than enough signal to get long VCRA in a stock swing trade. (more…)
Earnings Trade of the Day: JWN
Nordstrom, Inc (JWN) is a specialty retailer with 225 stores across the U.S. The company’s stock is currently trading around $77.80 in a 52 week range of $45.82-$79.12. The stock has been performing well this year adding nearly 18% to share prices year to date. JWN is set to report their most recent quarterly earnings today after the market close. JWN has been a weak performer on earnings day over the past 8 quarters. The stock has sold of 6 times rallied 1 time and finished the day unchanged one other time. Despite this weak historical performance the stock is trading just off of its 52 week highs into the release. This Ichimoku Cloud is also indicating further upside in JWN. Shares of JWN competitor Macy’s Inc. (M) rallied this morning on earnings after reporting earnings of $0.47 per share against consensus estimates of $0.38. This should bode well for JWN earnings as they operate in a very similar market space. So despite the weak historical performance in JWN we believe that the chart is strong enough and the sector is strong enough to rationalize a long ahead of earnings. JWN moves 1.9% on earnings day on average. The options market is currently implying a move of $1.45 by tomorrows expiration giving us an upside target around $64.53. Using this target we will set up a trade. (more…)
Covered Call of the Day: CDNS
Cadence Design Systems, Inc (CDNS) designs electronic design software and hardware. The company’s stock is currently trading around $12.75 in a 52 week range of $12.15-$15.96. The stock has been underperforming the broader market this year with share prices falling over 5% year to date. Despite the stocks weak performance this year a trader has stepped in and gotten long CDNS through May of next year. Earlier in today’s trading session a trader sold 9,800 CDNS May 12 puts for $0.65. This is an extremely bullish trade that also represents volume 13.2 times the average daily option volume in CDNS. The large amount of risk attached to this trade also suggests that this trader has very high conviction. This trader is making a large bet that the stock will close above $12.00 on May expiration, we want to express the same view on CDNS using a covered call. (more…)
Stock Swing Trade of the Day: DAN
Dana Holding Corporation (DAN) provides driveline and thermal management products for vehicle manufacturers. The company’s stock is currently trading around $19.40 in a 52 week range of $12.70-$23.46. The stock has been performing well this year adding more than 24% to share prices year to date. Unusual action in DAN options during today’s trading session indicates there could be further upside in store for DAN. Earlier in today’s session a trader bought 2,288 DAN Jun 19 Calls for $2.15. This is nearly a $500,000 bet on DAN rallying through June expiration and shows this traders relatively high level of bullish conviction in DAN. Technically speaking the stock has been trading in bearish territory, according to the Ichimoku Cloud, since they reported their last quarterly earnings results on October 28th, but we believe this order is significant enough to serve as a signal for a long swing trade in DAN. We will use the Ichimoku Cloud to help set stops and targets. (more…)
Bullish Signals
A trader bought 1,200 SPLV Jun 33 Calls for $0.90 (46.3 times usual volume) with stock at $32.54
A trader bought 2,288 DAN Jun 19 Calls for $2.15 (6.4 times usual volume) with stock at $19.29
A trader bought 15,400 MTW Jan 2015 30 Calls for $0.90 (5.8 times usual volume with stock at $19.25
A trader bought 2,200 PAY Dec 27 Calls for $0.70 (2.9 times usual volume) with stock at $25.21
A trader bought 6,800 AMTD Jan 2015 35 Calls for $1.20 (4.8 times usual volume) with stock at $28.70
Bearish Signals
A trader bought 1,000 KBR mar 14 Puts for $2.25 (3.2 times usual volume) with stock at $34.35
A trader bought 4,485 BHP Dec 67.5 Puts for $1.17 (3.4 times usual volume) with stock at $69.43
A trader bought 7,000 HMA Dec 11 Puts for $0.05 (3 times usual volume) with stock at $13.13
A trader bought 3,980 AFFX Dec 7.5 Puts for $0.65 (14.3 times usual volume) with stock at $7.74
A trader bought 7,300 EWJ Nov 11 Puts for $0.11 (3.3 times usual volume) with stock at $11.88
Unusual Option Activity
A trader bought 3,980 AFFX Dec 7.5 Puts for $0.65 (14.3 times usual volume) with stock at $7.74
A trader bought 7,300 EWJ Nov 11 Puts for $0.11 (3.3 times usual volume) with stock at $11.88
A trader bought 6,800 AMTD Jan 2015 35 Calls for $1.20 (4.8 times usual volume) with stock at $28.70
A trader bought 15,400 MTW Jan 2015 30 Calls for $0.90 (5.8 times usual volume with stock at $19.25
A trader bought 2,288 DAN Jun 19 Calls for $2.15 (6.4 times usual volume) with stock at $19.29
Long term Trade of the Day: AMTD
TD Ameritrade Holding Corporation (AMTD) is a securities brokerage and retail financial services company. The company’s stock is currently trading around $28.80 in a 52 week range of $15.20-$29.25. The stock has been massively outperforming the market this year having added over 71% to share prices year to date. Unusual activity today in the options market suggests that traders believe this rally will continue through next year. Early in today’s trading session a trader bought 6,800 AMTD Jan 2015 35 calls for $1.20. This is a $816,000 bet on further upside in AMTD and represents this traders high level of bullish conviction in AMTD. This block also trades at volume 4.7 times the average daily option volume in AMTD. The chart supports such a play in AMTD with shares trading just off their 52 week high and well above the Ichimoku Cloud. The future cloud is also upward sloping indicating the potential for further upside in AMTD. With the strong technical and very bullish order flow we believe that AMTD is setting up well for a long term trade. (more…)
Earnings Trade of the Day: M
Macy’s Inc (M) is a retailer operating stores and websites under the Macy’s and Bloomingdale’s brands in the United States, Guam and Puerto Rico. The company’s stock is currently trading around $46.80 in a 52 week range of $36.30-$50.77. The stock has been performing well this year adding nearly 20% to share prices year to date. Macy’s is set to report their most recent quarterly earnings tomorrow before the market open. The stock has been a mixed performer on earnings day over the past 8 quarters. In the past 8 quarters the stock has rallied 4 times and sold off 4 times on earnings day moving 3.1% on average. On a chart shares of M are once again trading in bullish territory for the first time since mid-August. The future cloud is also beginning to slope upward suggesting there could be strength in M through the end of the year. We believe that the technical picture coupled with historical performance sets up well for a long ahead of earnings. With the options market currently implying a move of around $3.45 by November expiration we can calculate an upside target and set up a trade. (more…)