HON, SFUN Options – Unusual Trading Activity – July 21, 2014
This week we’re taking a look at unusual options trading activity in Honeywell (HON) and SouFun (SFUN).
As many of you know, unusual options volume can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term.
This is something professional options traders pay a lot of attention to, and for good reason… Unusual options activity can “tip off” big moves in a stock, either up or down.
So let’s take a look at some ‘interesting’ activity that caught our eye this week:
Honeywell (HON)
Plenty of bullish options action suggests Honeywell may continue setting record highs.
HON is currently trading for $96.65. The price is 24% above the 52-week low of $77.72 and is just 1% below the 52-week high of $97.28.
Today, over 7,500 August 95 calls have already traded. The price of the calls has ranged from $1.98 all the way up to $3.05. Open interest implies this is all opening action.
HON has hit all-time highs after posting strong earnings last week. The large amount of calls being purchased means investors believe the strong run will continue. Action like this is typically a good sign for bulls.
SouFun (SFUN)
There’s been some interesting, somewhat bullish action in Chinese real estate Internet portal, SFUN.
SFUN is trading for $10.28, down 39% on the year. The shares are 48% below the 52-week high of $19.94 and 75% above the 52-week low of $5.86.
Traders have already sold more than 6,000 August 10 puts for $0.60 per option. The put seller will collect the premiums should SFUN remain above $10 per share at August expiration.
SFUN has dropped substantially from its highs this year on various concerns. But, traders apparently believe there’s a strong floor at $10 per share given the large numbers of puts being sold there.
More Options Ideas…
That wraps up this week’s unusual options trading and volume…
Keep in mind, there’s a lot more unusual options activity going on than what we discuss here.
We just try to bring you what we feel are the most significant ones– and the ones you might actually be able to make some money on!
So keep an eye on your email inbox… we have a lot more options trading ideas coming your way!
Yours in Profit,
Gordon Lewis
Category: Unusual Options Trading Activity
