Unusual Options Activity: Marathon Digital Holdings (MARA)

Cryptocurrency mining company Marathon Digital Holdings (MARA) is having a strong year, with shares up 360 percent. One trader is betting on a move higher in the coming weeks.

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  • That’s based on the January 12 $14 calls. With 24 days until expiration, 4,039 contracts traded compared to a prior open interest of 153, for a 26-fold rise in volume on the options trade. The buyer of the calls paid $4.80 to make the bullish bet.

    Marathon shares recently traded just over $18, meaning the option is already over $4.00 in-the-money. The stock has a 52-week high of $19.88.

    The company is coming off a tough year, following last year’s crypto bear market. But for 2023, things are looking stronger, with revenues up 671 percent. At the moment, Marathon doesn’t make a profit.

    Action to take: Shares have already shown they can outperform the price of cryptos, particularly bitcoin.

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  • A continued rally there is likely in the next year following the next halving and the approval of a bitcoin ETF.

    Shares could still have far more upside next year compared to this year. That makes Marathon a worthwhile speculative investment now.

    For traders, the January $14 calls are deep in-the-money. But they don’t have too long to play out. They can likely deliver mid-double-digit gains in that time.

    More aggressive traders may want to look further out and higher up for a 2024 crypto rally.


    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.

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