Sarah Wasserman (swasserman@sir-inc.com) Wynn Resorts, Limited (WYNN) sprinted to a new 52-week high of $97.26 today, adding to its year-to-date gains of 61%. Today's positive momentum shot the shares past short-term resistance at $95 -- a level which had resisted WYNN's rally attempts in September.
Option players have flocked to this technical outperformer today, with volume of 27,000 contracts changing hands by midday -- quadruple WYNN's usual daily volume of around 6,400 contracts.
WYNN's October 100 call has attracted notable attention today, with over 4,300 contracts traded on this strike -- 66% of which changed hands at the ask price, indicating they were likely purchased. If these 100-strike calls were, indeed, bought to open, then it would seem that some bullish traders are counting on WYNN to tackle triple-digit territory before October expiration -- which occurs after the close this Friday, Oct. 15.
However, despite today's bullish activity, option traders have been placing bearish bets on WYNN at a rapid-fire pace lately. During the past two weeks alone, speculators on the International Securities Exchange (ISE) have bought to open 2.5 WYNN puts for every call, a ratio which ranks above 90% of all other readings taken during the past year.
Moreover, peak put open interest of some 8,000 contracts can be found at the October 85 strike. As Friday's expiration nears, an unwinding of these out-of-the-money puts could add more fuel to WYNN's latest rally.
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