Here is some generally directional, untied options activity that caught my eye during Tuesday’s trading:
1. XLY – saw a large bearish roll. When the consumer discretionary etf was a 76.
2. TWTR – since last Tuesday, shares of TWTR have seen one day where the stock has closed up (Thursday) and even then fractionally. The stock is clearly trying to find a bottom at current levels, down 26% in the last week:
Yesterday, shortly after noon when the stock was $38, there was a buyer of the Jan2017 60 calls, paying $3.05 for 5,000. Before you TWTR bulls get all geeked up, these look like they were bought to close vs 12,800 of open interest, possibly a long holder closing an overwrite.
3. FB – call volume ran 3x that of puts, a bit above the average over the last month, with the top 10 most active contracts all calls. The most active were 11,000 of each of the following strikes: June 90 calls, Oct 95 calls and June 80 calls. This call activity came on a day when FB touched its 200 day moving average for the first time since July 2013, and closed just above:
In the near term, a test an hold of the important momentum indicator, would likely mean a re-test of the low $80s, but a failure here, following a 5% decline since earnings would likely result in a re-test of the Dec lows near $70 in the coming weeks (possibly days).
4. BABA – options volume exploded yesterday, more than 2x average daily volume, on a day that saw the stock make a new all time low, breaking important near term support at $80 and closing below:
BABA reports their Q1 results tomorrow before the open, and the options market is implying about a 7% event move vs. the average move of 6.5% in the two quarters since going public in September. The largest trade of the day yesterday was a roll in puts, where a trader sold to close 9,000 May 8th weekly 80 puts at 3.50, and bought to open 9,000 June 77.50 puts for 3.40, likely rolling protection.