Swaggy is back with his Sunday morning read of Unusual Options Activity.
As for unusual trades, it’s been pretty quiet the last two weeks. Most flow is coming into big tech stocks and pumping them higher. I caught a few other smaller plays that I’ll get into the details of here.
MSFT – Microsoft Corporation
Microsoft has been a repeat name for some bullish flow in the last months. Looks like players have been opening bull call spreads with relatively medium-term expirations (end of the year) expecting the stock to continue it’s slow rise up. The range of strike prices has been $215-$240. MSFT has been one of the companies looking to acquire TikTok in the latest rumors. Other names that have seen some similar flow last week were AMZN, FB, ADBE, and of course, AAPL.
NVDA – NVIDIA Corporation
NVDA reported earnings last week and although they blew estimates out of the water, the stock remained flat post-earnings. NVDA demonstrated some high growth in their server market and overall they have been one of the best performing tech stonks. Flow has been mixed, but leaning on the bullish side. Overall activity has picked up greatly since last week as traders could be expecting another move up.
QCOM – QUALCOMM Incorporated
QCOM is another semi-conductor company that has seen a good run over the last several months. Players placed bets that the company would continue it’s steady rise up as demand for chips in a more data-driven world are becoming the new norm. A lot of calls were traded with strikes in the $105-$120 range. These mostly have expirations from November to January 2021, so they are mid-term in the timeframes and expectations.
ORCL – Oracle Corporation
ORCL has seen an uptick in activity on the bullish side. Rumors are they are making a bid for the TikTok acquisition as well. ORCL’s stock price has been somewhat stagnant over the last several months and they didn’t rally as hard as the rest of big tech from the March lows. The option flow might indicate a bullish move in the future for this stock.
LYFT – Lyft Inc
LYFT and UBER have shut down service in California due to a new ruling that would require them to treat independent contractors as employees with benefits moving forward. Their rebuttal was to simply shut-down service and put the pressure back on the government to make their next move. Soon it will show that these ride-sharing companies have become a staple in our societal culture as they have made our lives so much easier. A whole slew of some pretty large calls were opened last week that was caught as bullish flow. I’m not sure what the catalyst would be here, maybe it’s because the stock is near the lows and shutting down service actually induces less losses on the company. Who knows.
DLTR – Dollar Tree Inc
Dollar Tree caught some unusual call volume last week. Looks like players are betting on a 10% gain in the stock price with the October strike. These bets weren’t unusually large in size, but for a company like DLTR they were pretty significant. The plays were sweeps at the $108 strike in Sept 25/Oct 02 expirations. The stock has had a decent run over the last several months and the players are expecting another leg up soon. We’ll see about this one.
CRM – Salesforce
CRM/Salesforce has been a hot stock recently. There was some bullish flow earlier this month and again into last week. My scanner picked up two long position, although in my opinion it looks like a spread was opened (still bullish). The spread was actually opened when the stock was trading at $197, and it is currently $10 higher at $207. The player bought to open 11,000 calls at the $200 strike and sold 11,000 calls at the $220 strike, paying $9 million for the position. They are already profitable on their position, but if CRM closes above $220 by February, they will have a net profit of $22 million.
CZR – Caesars Entertainment Inc
CZR caught some bullish activity last week when players opened January and March 2021 calls. The stock has already had an unbelievable recovery from the March lows, but is still nowhere near the highs. Looks like as the country opens back up again (if it stays that way), they expect the company to continue it’s good performance. Some of the bullish flow was put-selling, which suggests the stock will have already reached it’s long-term bottom.