Stocks quoted in this article:
Option Brief: BlackBerry Ltd (NASDAQ:BBRY) succumbed to yesterday's broad-market sell-off, but managed to find a foothold atop the $9 mark. The pullback didn't scare one group of option traders, who bet on a bounce from this former layer of resistance -- and a quick move into double-digit territory.
Specifically, the most popular position in BBRY's options pits on Monday was the weekly 2/7 10-strike call, where 69% of the 4,049 contracts traded did so on the ask side. Implied volatility shot 20.7 percentage points higher, and open interest added 2,523 contracts overnight. Summing it all up, it appears a fresh batch of bullish bets was initiated.
Should BBRY fail to retake the $10 level by Friday's close (the stock was trading north of this round-number mark as recently as last Thursday), the most traders have on the line is the initial cash outlay. According to Trade-Alert, the volume-weighted average price for the out-of-the-money calls was a modest $0.07 per contract.
Technically speaking, BBRY has been making a move north since bottoming out at a 10-year low of $5.44 in early December, with the shares up nearly 69% since then to trade at $9.18. BlackBerry Ltd (NASDAQ:BBRY) is poised to resume its uptrend in today's session, with the stock pointed 0.9% higher right out of the gate.