Put volume on the iShares Barclays 20+ Year Treasury Bond Fund (NYSEARCA:TLT - 121.88) is running about six times ahead of what's typical, as speculators exit a September position and open a similarly sized block in October. A massive block crossed the tape shortly after 11:00 a.m.

The September 124-strike put saw 33,000 contracts trade off the bid price of $2.44 while a block of 48,500 contracts at the October 122 strike traded between the bid and the ask prices, at $2.51 per contract. It appears as though traders are selling out of an existing long put at a modest profit (opened in late August for $1.84, according to Trade-Alert). They are then rolling these positions forward to the October series and down to the 122 strike (and increasing the size of the block a bit as well).

This trade will benefit if the bond market in general and TLT in specific move lower through the next several weeks. Breakeven for the October put (at expiration) is $119.49, below which gains are theoretically limited only by the zero mark. Above the strike price, the loss is capped at 100% of the premium paid.

TLT is down 1.4% today ahead of tomorrow's Fed announcement. It is trading about 2% north of the breakeven point of today's put trade.