This activity should be considered aggressively bullish volatility and bullish the underlying, although obviously this could be a hedge predicting a top in XLF.
Short-Term Bullish Action in XLF
The Select Sector Financial ETF trading 24.30 is seeing short term bullish call action.? A trader or traders has, electronically bought the February regular 24.5 calls, just OTM, from .15 all the way up to .18.? On the day over 25,000 have traded on the strike with the largest blocks, adding up to about 15k trading for .15 and .16 a contract.
In addition 20,000 of the February 25 calls have also traded .06.? Average call volume is 43,000, over 65,000 calls have traded most have been purchased.? Average daily volume is 70,000.
This activity should be considered aggressively bullish volatility and bullish the underlying, although obviously this could be a hedge predicting a top in XLF.
Heavy Call Action in CX
Cemex SAB currently trading 10.00 a share is seeing heavy call action today.? Traders have bought large 1 by 2 call spreads in January 2016.? Traders have bought in blocks of 1500, 2500, 5000, and 10,000 the 10/15 call 1 by 2.? They bought the 1 for 1.58 and sold the two at .23 a contract.? In total about 19,000 1 by 2s have traded for 1.12.
ADV in this name is just over 10,000.? Today 63,000 contracts have traded 59,000 of which are calls.? This trade should be considered somewhat neutral volatility to slightly bearish IV in CX, but aggressively bullish.? The trader is betting CX is going to be up 50% by the end of the year.? This would be a nice move in the name
Looking for a Cheap Hedge in X
United States Steel Corp currently trading 23.20 is seeing a bear 1 by 2 trade go up in Jan 2016.? Trader bought 5,000 of the Jan16 20 puts for 2.90 and sold 10,000 of the Jan16 13 puts at .57 a contract.? Net the trader bought the Jan 20/13 1 by 2 put spread for 1.40.?
ADV in this is 30,000. Over 35,000 have traded today with 33,000 being puts.? This trade is likely a trader that is long X and is trying to find a cheap way to hedge his or her position.? The trader in doing this trade is protecting his or her position well below 10.00 a share.
This trade should be considered bearish volatility in X and likely bullish X as it is likely related to a stock trade.