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Option Brief: Intel Corporation (NASDAQ:INTC) has added 0.2% to flirt with $24.69 today, but remains 0.3% lower on the week. From a longer-term perspective, the equity has spent the past few weeks dawdling south of the $25 level, home to its stagnating 10-week moving average. However, options traders are rolling the dice on a short-term breakout for INTC, picking up calls at a faster-than-usual clip.
So far today, the blue chip has seen roughly 33,000 calls change hands -- a 25% mark-up to its average intraday call volume, and more than triple the number of INTC puts exchanged. Aside from calls expiring at today's close, the weekly 3/28 25-strike call and the April 26 call are most popular, with around 3,100 and 5,400 contracts traded, respectively. The majority of the calls traded on the ask side of the tape, and implied volatility is trending higher at both strikes, underscoring our suspicions of newly bought bullish bets.
By purchasing the weekly calls to open, the buyers expect INTC to muscle atop $25 by the close on Friday, March 28, when the contracts expire. Meanwhile, buyers of the April 26 calls have higher hopes for the stock, but are allowing more time for their bullish predictions to pan out. Specifically, the calls will move into the money if INTC topples $26 by the close on Thursday, April 17. Risk is limited to the initial premium paid for the contracts, should INTC remain south of the strikes through the options' respective lifetimes.
Now is a great time to buy Intel Corporation's (NASDAQ:INTC) options, too. The security's Schaeffer's Volatility Index (SVI) sits at an annual low of 16%, suggesting the equity's short-term contracts haven't been more attractively priced during the past year, from a volatility perspective.