Stocks quoted in this article:
On Wednesday, Carnival Corp. (CCL - 21-7/16) retreated by nearly two percent to close below its 10-day moving average for the first time since August 1. The stock has slipped further beneath this short-term trendline today, and it is currently down by just over three percent. The shares have encountered overhead resistance this week from their 20-week moving average, which they haven't finished a week above since early February.
In CCL's options pit this afternoon, investors are showing their belief that the security has more downside potential. The out-of-the-money September 20 put has seen 2,050 contracts cross the tape. Open interest at this strike stands at a mere 17 contracts, indicating that almost all of today's volume will become new positions. If so, this could provide a layer of downside protection for the equity. Presently, this is one of the most-active puts on the CBOE.<