Big Printin’ – 6/24/15: $BAC, $EBAY, $EEM, $FB

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

1. BAC – The largest single stock options trade of the day was in BAC,. When the stock was 17.60 a trader paid .58 for 30,000 Jan2017 13 puts, they were marked closing, against open interest of 57,000 options in that strike.  Taking a quick look at the one year chart, the 50 day moving average (purple below) is about to cross over the 200 day (yellow below), which some technicians call a golden cross, signalling a pick up in short term momentum.  I would also add that the converging moving averages at $16.50 should serve as near term support:

2. EEM – the single largest etf options trades today came in the emerging market etf, first where a trader paid 27 cents for 100,000 July 41.50 calls to open and sold 280,000 shares at $40.95 just before noon.  This could have been a stock replacement strategy where the call buyer has now defined their risk to the 27 cents over the next 3 weeks, with a break-even at $41.77, up about 2%.  Later in the day shortly after 3pm there was another 100,000 of the July 41.50 calls bought for 26 cents when the stock was $40.82, this time not tied to stock.

Taking a quick look at the one year chart it is important to note that $40 is near term support, with the double bottom low from Q1 the line in the sand on the downside, with obvious resistance at $44:

3. EBAY – a trader closed out of a prior bullish bet, when the stock was $61.86, 15,000 of the Jan16 60/67.50 call spread was sold to close at $3.05.  This comes on a day that YHOO management told shareholders at their annual meeting that they are “committed to the tax free spin” of their BABA holdings.  The IRS handling of this issue could have implications for EBAY’s intended tax free spin of their PayPal unit.

4. FB – the stock continued its epic breakout today, with the stock up nearly 8% this week alone, trading at new all time highs.  Shortly after the open when the stock was $88.60, there was a buyer of 13,500 July 31st weekly 88.50 calls paying $3.25 to open, or about $4.39 million premium.  These calls break-even at $91.75, up about 3.5%, and I suspect the call buyer is targeting further gains into and out of FB’s Q2 earnings expected the last week of July.