Thursday’s Notable Options Activity: $C, $EMC. $FXE, $GLD, $MSFT, $SUNE

by Dan January 16, 2015 7:22 am • Commentary

Here is some untied, generally directional options activity that caught my eye during Thursday’s trading:

1. C- closed down 3.7% after reporting disappointing results. It was the worst post earnings decline since January 2014. Interestingly, the two most active options were calls, as there was a closing seller of 17,600 June 55 calls at .78 when stock was 47.15, and a buyer of 12,500 March 52.50 calls paying .67 to open when stock was 47.70.  Total options volume ran 2.5x average daily.

2. COH- puts were active at 10x average daily volume.  When the stock was $36.84, a trader sold to close 5000 Jan23rd weekly 38 puts at 1.20 and bought 5,000 Jan 30th weekly 37 puts for 1.80 to open. The spread traded 10,000x on the day. The company has not set their Q4 report date, but this trader is obviously looking to buy a little more time on a possible hedge.

3. EMC – trader closed out of a prior bullish view with 40,000 April 31 calls sold to close at 37. It looks like these were bought in early Oct when stock was 28.70, from our post Oct 6th:

EMC – When the stock was 28.70, a trader sold 40,000 of the Jan15 31 calls at .70 to close, and bought 40,000 of the April 31 calls for 1.13 to open.

4. FOXA – the stock has sold off 12% from the all time highs made late last year and is now down 10% on the year.  When the stock was 34.71 a trader closed a prior bullish view selling 10,000 Feb 37 calls at 35 cents.

5. FXE – The Euro has been an unmitigated disaster, as investors anticipated QE from the ECB in the near future were blind-sided by the move from the Swiss Central Bank allowing the Franc to appreciate against the Euro  Last week’s break of 1.20 vs the US dollar might have been a watershed event on the currency’s way back to parity with the dollar:

EUR/USD 15 yr chart from Bloomberg
EUR/USD 15 yr chart from Bloomberg

One trader took a contrarian view today, playing for a short term bounce in the FXE,. When the etf was 114.40, a trader paid .29 for 5,000 of the Jan23rd weekly 117/119 call spread to open. Total options volume ran almost 5x avg daily.

6. GLD –  calls were very active, trading 6x avg daily volume, with calls outnumbering puts 4 to 1.  Most of the top 10 most active strikes were calls, with the two most actives 40,000 of the March 126 calls and 120 calls.  A few trades that stood out were; a bullish roll when the stock was 121.15,  a trader sold 19,500 March 120 calls at 4.38 to close and bought 19,500 March 126 calls for 2.02 to open. Also was a buyer of 18,600 April 145 calls for .45 to open when stock was 121.15 and a buyer of 14,700 May 145 calls for .60 when stock was 121.26

7. JNPR – reports Q4 Jan 27 after the close.  The stock got slayed today, down 3.9% representing most of its losses on the year. When stock was 21.35 a trader paid 1.07 for 16,500 July 19 puts to open.

8. MSFT – options volume ran 2x average daily volume, with calls outnumbering puts 2 to 1.  There was a lot of bullish activity, when stock was 45.72 there was a large bullish roll, a trader paid 2.05 for 26,000 Jan16 50 calls to open, and sold to close 17,000 Jan16 40 puts at 2.20, sold 9000 Jan16 42 puts at 2.87, sold 8100 Jan14 40 calls at 5.60 and sold 10,000 Jan15 37 calls at 8.60 to close.  There was also a bullish in the money call roll in MSFT,trader sells to close 11,300 Jan 40 calls at 5.70 and buys 11,300 Oct 40 calls for 6.90 to open

9. SUNE – saw a very sizable premium sale on day that saw the stock decline 9%.  When stock was 19.84 a trader sold 18,000 April 20 Straddles (selling the call and the put) for combined premium of 4.80. This structure has a slight short delta. If this is merely a vol sale, then the trader makes money if the stock is below 24.80 and above 15.20 on April expiration. Alternatively this could be a yield enhancement strategy against a long stock position.