Autodesk, Inc. (ADSK) is a company that develops design software for customers in architecture, engineering, and digital media industries. Shares of ADSK are currently trading around $40.90 in a 52 week range of $30.22-$42.82. The stock has been strong this year adding to share prices by over 15% year to date and over 26% in the past 12 months. Unusual activity in ADSK indicates to us that traders believe this run will continue through the end of the year. Early in today’s trading session a trader bought 10,000 ADSK Dec 44 calls for $0.88. This block represents volume 2.6 times the average daily option volume in ADSK. This is a very bullish trade that expresses this block trader’s belief that the stock will rally through the end of the year. The chart of ADSK also confirms that the stock is trading in bullish territory and could have more upside to come. Shares are trading well above the Ichimoku Cloud with the future cloud strongly sloping higher suggesting higher prices in the future. Given the technical strength in ADSK and the bullish unusual option activity we believe that ADSK sets up well here for a swing trade. (more…)

Cheniere Energy, Inc (LNG) is operates liquid natural gas related businesses. The company’s stock is currently trading around $39.75 in a 52 week range of $13.85-$40.85. The stock has been raging higher rallying over 111% year to date and over 144% in the past 12 months. LNG is set to report their most recent quarterly earnings today after the close. Recent earnings day performance in LNG has been relatively weak with the stock selling off 3 of the past 4 quarters. On average, the stock moves 2.4% on earnings day. Despite LNG’s weakness on earnings day we have seen a lot of bullish options order flow recently.  On Tuesday a trader bought 10,000 of the LNG Jun 34-44 bullish risk reversals for $0.51.  This is a very bullish bet that comes on the back of several other bullish blocks bought over the past two weeks. With a very strong chart we believe that this bullish order flow signals trader’s strong conviction to the upside in LNG. Currently the options market is implying a move of around $1.60 by November 8^th expiration giving us an upside target of $41.35 by Nov 8^th expiry. Using this target we can now set up an options strategy. (more…)

Covanta Holding Corporation is an operator of systems that convert waste to energy in addition to other waste disposal and renewable energy businesses. The company’s stock is currently trading around $17.20 in a 52 week range of $16.70-$21.89. CVA has been lagging the market this year as shares have fallen over 6% year to date. Despite the recent fall in the stock we have seen a large amount of bullish order flow in CVA.  Early in today’s trading session we saw a trader buy 25,000 of the CVA Jun 2015 15-22.5 call spreads for $2.60. This block represents volume 21.2 times average daily option volume in CVA and indicates this trader believes the stock will trade above $22.50 on June expiration. We believe that this order is an extremely bullish signal and a good opportunity for a long term trade. The Jun 25 calls are currently trading at $0.10-$0.15 so rather than selling them against the 15 calls we believe it is better to leave our profit potential uncapped. (more…)

American Axle & Manufacturing Holdings, Inc (AXL) is a designer and manufacturer of drivetrain systems for a variety of vehicles. The company’s stock is currently trading around $18.60 in a 52 week range of $9.27-$21.41. The stock has been outperforming the broader market adding over 66% to share prices year to date. The company will be reporting earnings tomorrow before the bell. We are currently seeing some bullish unusual option activity in AXL which is leading us to believe the stock will head higher on earnings. Early in today’s trading session a trader sold 1,000 AXL Nov 18 puts for $0.50 when stock was trading $18.38. This is an extremely bullish trade that indicates this trader strongly believes the stock will close above $18.00 on November expiration. Even though the stock is trading below the Ichimoku Cloud it is still inside of its bull channel that has been formed since the stock broke out late last year. We believe that these circumstances provide an opportunity for a covered call in AXL. (more…)

A trader bought 1,000 ONNN Nov 7 Calls for $0.35 (4.7 times usual volume) with stock at $7.01
A trader bought 3,000 ERIC Jan 2015 15 Calls for $0.60 (3.4 times usual volume) with stock at $11.87
A trader bought 11,000 TWM Jan 32 Calls for $0.05 (8 times usual volume) with stock at $13.74
A trader bought 2,200 REN Nov 10 Calls for $0.25 (3.5 times usual volume) with stock at $9.25
A trader bought 1,200 DATA Nov 7 Calls for $0.70 (2.9 times usual volume) with stock at $62.44

A trader bought 2,000 TYC Nov 33 Puts for $0.09 (2.3 times usual volume) with stock at $36.13
A trader bought 2,000 SGEN Dec 30 Puts for $0.70 (2.9 times usual volume) with stock at $39.19
A trader bought 2,150 CETV Apr 2.5 Puts for $0.55 (19.9 times usual volume) with stock at $2.94
A trader bought 1,000 JAH Apr 50 Puts for $1.80 (2.7 times usual volume) with stock at $54.00

A trader bought 11,000 TWM Jan 32 Calls for $0.05 (8 times usual volume) with stock at $13.74
A trader bought 2,200 REN Nov 10 Calls for $0.25 (3.5 times usual volume) with stock at $9.25
A trader bought 1,200 DATA Nov 7 Calls for $0.70 (2.9 times usual volume) with stock at $62.44
A trader bought 2,000 TYC Nov 33 Puts for $0.09 (2.3 times usual volume) with stock at $36.13
A trader bought 2,000 SGEN Dec 30 Puts for $0.70 (2.9 times usual volume) with stock at $39.19

CBOE Holdings, Inc (CBOE) operates markets for the trading of equity, index and other exchange trade options. The CBOE also holds exclusive listing rights for SPX options and VIX futures and options. The company’s stock is currently trading around $49.55 in a 52 week range of $29.01-$51.12. The stock has been massively outperforming the market this year adding over 68% to share prices year to date. CBOE is set to report their most recently quarterly earnings tomorrow before the open. The stock is historically strong on earnings day. Over the past 8 quarters the stock has rallied 6 times on earnings day with an average move of 2.2%. Shares of CBOE are also trading above the Ichimoku Cloud, indicating the stock is in bullish territory. We believe that the historical strength in CBOE on earnings and the bullish chart set up provides us with an opportunity for a long in CBOE ahead of earnings.  Currently the options market is implying a move of $2.00 in CBOE by November expiration. Using this implied move we can calculate an upside target of $51.40. Using this upside target we can now set up an options strategy that will have a well-defined risk vs. reward profile and a low initial capital outlay. (more…)

A trader bought 3,000 BRKR Mar 22.5 Calls for $1.20 (18.1 times usual volume) with stock at $20.71
A trader bought 10,000 CBS Mar 60 Calls for $3.60 (5.6 times usual volume) with stock at $59.08
A trader bought 2,000 HNT Dec 32.5 Calls for $0.85 (5 times usual volume) with stock at $30.04
A trader bought 1,000 NVAX Nov 3 Calls for $0.25 (2 times usual volume) with stock at $3.20
A trader bought 1,000 MM Jan 2015 12.5 Calls for $1.35 (3.2 times usual volume) with stock at $7.13

A trader bought 1,300 SFI Dec 12 Puts for $0.25 (4.9 times usual volume) with stock at $12.51
A trader bought 2,655 BMRN Nov 60 Puts for $1.00 (3.5 times usual volume) with stock at $64.59
A trader bought 5,000 FBC Apr 15 Puts for $1.45 (10 times usual volume) with stock at $16.24
A trader bought 29,000 PLCM Nov 12.5 Puts for $2.05 (4.8 times usual volume) with stock at $10.61