Sarah Wasserman (swasserman@sir-inc.com) Put volume has soared on Alcoa Inc. (AA) today, with roughly 36,000 of these typically bearish bets crossing the tape -- five times the aluminum issue's expected single-session put volume.
With just hours until November-dated options expire, option traders have looked ahead to the December series. The December 13 put has been a popular choice among speculators today, with some 3,200 contracts changing hands on this strike -- 64% of which traded at the bid price, indicating they were likely sold. However, with over 7,500 contracts currently open at this strike, we cannot yet confirm whether new positions are being added here today.
If these December 13 puts were, in fact, sold to open, then it would appear that traders are counting on AA to remain above $13 over the next month. Technically speaking, AA has been consolidating just above the $13 level for the past several weeks. During this time, the stock's 10-week moving average has caught up to the shares, and is now located just below $13. AA has not closed a week below this intermediate-term trendline since Aug. 27.
Elsewhere, it appears that the shorts are betting on AA to backpedal, with short interest jumping by 10.1% during the past month. These bearish bets now account for a solid 6.8% of the stock's total available float.
AA is currently trading around $13.27.
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