Traders bet on rally to continue.January 31st, 2020 $40.50 call options onAT&T (T) saw a 25-fold rise in open interest, going from 205 contracts to over 5,000 trade hands. With 39 days until expiration, the bet is that shares will rally another $1.50, or 3.8 percent from their current price around $39. The buyer paid around $0.32, or $32 per option contract, and would need to see shares closer to $41 to make a profit at expiration. AT&T, the telecom giant, has diversified in recent years with acquisitions that have expanded it from delivering content to creating it as well, mo...

Traders bet on massive rally in the first half of 2020.July 2020 $65 call options onIntel (INTC) saw a 19-fold increase in volume. Going from 213 to over 3,900 contracts, the bet is that shares will continue their rally. The recent price for shares around $57.50 relative to the option strike price indicates a 13 percent move higher in the next 210 days before expiration. The traders paid around $1.55, or $155 per contract. Any move closer to the strike price in the next few weeks could lead the option to surge well before the time premium runs out, otherwise the trader will need share...

Traders bet on company heading higher.The February 2020 $135 call options onEli Lilly and Company (LLY) saw a 20-fold rise in volume, going from 164 open contracts to over 3,380 trade hands. With 64 days to go until expiration and with shares trading around $128.50, the option will move in-the-money with a 5 percent rally in shares. Given the option price around $1.95, the option buyer stands to profit at expiration if shares hit $137 or higher. The option trade comes as the company reports earnings, with an upbeat note on sales and its profit outlook for 2020, further bolstering the ...

Rise in put-buying suggests drop in shares.Multiple options trades onApple (AAPL) suggested a potential decline in shares. Of the trades made with high volume, the most interesting was the July 2020 $265 put option. That trade saw a six-fold rise in volume with nearly 600 contracts trade. Shares trade around $280, implying at least a $15 per-share downside, or about a 5.3 percent drop. With 212 days until expiration, any move down in Apple shares would allow the option to rally, giving traders a tidy profit. With shares of the tech company up 15 percent in the past month and nearly do...

February call buying indicates more upside to shares.Over 18,150 contracts traded on the February 2020 $52.50 call option onMorgan Stanley (MS). This is a 20-fold increase in volume from the open interest of 933 contracts. With 66 days to go before expiration, shares will need to rally about $1.50 or just under 3 percent for the option to move in-the-money. At a cost of around $1.16, or $116 per option, it’s a relatively inexpensive bet that the rally in financials will continue. Shares of Morgan Stanley have already beaten the overall stock market by 2 points in the past year thanks ...

March call buying suggests rally.Over 6,800 contracts traded on the March 2020 $29 call options onEnterprise Products Partners (EPD). Against the prior open interest of 879, the trading marks an eight-fold jump in volume. Shares of EPD currently trade just under $28, so the options are a bet on another $1 rise in shares in the next 99 days before expiration, or a move just 4 percent higher. Shares have traded as high as $30 in the past year. While the option could offer a profit in the next 100 days, without shares breaking to new highs, it will be somewhat limited, even at the cost of $...

Bet on further move higher in shares through February.Nearly 20,000 contracts traded on the February 21st, 2020 $30 call options inCorning Incorporated (GLW). Against a prior open interest of about 1,550 contracts, it’s a 13-fold jump in volume. With shares trading around $28.80, the option is about 4.1 percent out-of-the-money. Given how shares are trading near the bottom end of their range, a move higher in-the-money in the coming weeks is possible. At a cost under $1.00, each contract cost the buyer less than $100. Corning, perhaps best known for making the screens for smartphones ...

Bet on continued rally though May, 2020.Nearly 4,000 contracts traded on the May 2020 $15 call options onSeaspan Corporation (SSW). Compared to the prior open interest of 553 contracts, it’s a seven-fold surge in volume. Shares trade in the low $13 range, meaning they need to move $2 higher, or about 15 percent, before expiration in May to close in-the-money. The option price of around $0.50, or $50 per contract, means the buyer starts to make money if shares hit $15.50. Seaspan is an independent charter owner and manager of container ships based out of Hong Kong, operating a fleet of...

Long-dated, in-the-money put trade suggests downside ahead.Over 1,100 contracts traded on theNordstrom (JWN) April 2020 $40 put option, showing about a 7-fold increase over the prior open interest of 176 contracts. Given the $40 strike and shares trading around $38, the option is already about $2.00 in-the-money, and should move higher dollar-for-dollar with shares if they decline, less any loss in time premium. As the option trades around $5 per contract, it will make money for the buyer at expiration if shares drop under $35.00. This bet against the retailer comes during the holiday...

Bet on further rally this month.The December 20th $20 call options onJetBlue (JBLU) saw over 31,665 contracts trade hands, a 19-fold rise over the prior open interest near 1,700 contracts. The bet, expiring in 15 days, will be in-the-money if shares can rise another $1.00 from their current price near $19.00. The buyer paid $0.25, or $25 per contract, so any move higher in JetBlue shares could lead to a big percentage return in the next few days, even if shares don’t clear $20.Action to take: We like this short-term trade. Oil prices may have moved slightly higher, but they seem range-bo...