Intel Options (INTC): Unusual Trading Activity

| May 2, 2012 | 0 Comments

INTC OptionsOptions in chipmaker Intel are showing enormous options activity today.

Since Intel’s disappointing earnings a few weeks ago, it’s been on a rollercoaster ride.

In fact, after its earnings, the stock plummeted to a low of $27.24 before rebounding.  And today it’s trading back above its pre-announcement level at $29.22.

Here’s the thing… option traders think something is wrong with this sudden run-up.

More specifically, one option trader came in right at the open and purchased 20,000 contracts of the INTC June $29 strike puts at an average price of $1.00 a piece.

He actually spent $2,000,000 betting this stock is going to stop moving higher and again begin falling in price.

Remember, buying put options outright is a strategy used when a trader feels a stock is going to decline in value.

So, what’s behind this huge purchase of put options?

As most of you know, Intel is the world’s largest chipmaker based on revenue and unit shipments.

The company is also known for its dominant market share in microprocessors for personal computers (PCs).

I think this large put activity is due to nothing more than a large institution or hedge fund thinking INTC is technically at the top of its trading range.

We’ll wait and see if that holds true in this case.

For more detailed information on unusual options activity and how you can profit from it, be sure to sign-up for our daily newsletter, Options Trading Research.  It’s always 100% free and packed full of option trading ideas you can use immediately in your own portfolio.  Click here to subscribe for free.


Tags: , , , , ,

Category: Unusual Options Trading Activity

About the Author ()

Marcus Haber is the co-editor of Options Trading Research and boasts well over a decade of real-life options experience. Learning from some of the biggest names in the business, Marcus has served as an Options Strategist for a number of firms and was also appointed to the Options Advsiory Board with Pershing, a branch of the Bank of New York.