Here is some apparently untied directional options trades that caught my eye in today’s trading:
AAPL: shares of AAPL are down 2.5% as I write (read my analysis of the quarter and guidance here from this morning). Given the stock’s 20% gains since early September, and 30% rally from its 52 week lows made in the Spring, today’s decline in the face of slightly weak guidance is far from a disaster. The largest options trade in the stock came in the afternoon when the stock was $115, where a trader sold to close 27,000 Jan 2018 140 calls at $3.35 ($9.05 million in premium) and bought to open 20,000 Jan 2019 145 calls for $6.40 ($12.8 million in premium). This roll up and out a year breaks-even on Jan 2019 expiration at $151.40, up nearly 32% from the trading level, above the all time high of $134.50 made in April.
The stock should find some support at the downtrend near $107, with healthy long term support at $100:
BAC: when shares of Bank of America were trading $16.85 a trader sold to close 23,000 Nov 11th weekly 16 puts at 7 cents and bought to open 35,000 Nov 11th 16.50 puts for 20 cents. This appears to be a holder rolling up some near term protection as the stock trades at a new high for 2016:
T: shares of AT&T continue to see selling pressure following their $85.4 billion bid for Time Warner (TWX) announced over the weekend, with the stock making a fresh new 8 month low, now approaching long term support at $36. With the stock down 17% from its July multi-year highs, it has now round-tripped the entire breakout move:
Options volume in the stock today looked like traders monetizing protection, and closing out of short dated puts trying to re-coup whatever premium they can. First when the stock was $36.50 shortly after noon, a trader sold to close 40,000 Nov 35 puts at 19 cents. If this was closing out of short term protection against a long stock position, the trader possibly sees the decline becoming a tad exhausted. Later in the day when the stock was trading $36.35 a trader sold to close 10,000 Jan17 42 puts at $6.03. If these were protection against a long position then they have done their job!