Most Active Weekly Options: Micron Technology, Inc. (MU)

Micron Technology, Inc. option traders gamble on round-number support

by Karee Venema

Published on Nov 18, 2014 at 1:10 PM
Updated on Apr 20, 2015 at 5:32 PM

The 20 stocks listed in the table below are the names that have attracted the highest weekly options volume during the past 10 trading days. Those highlighted are new to the list since the last time the study was run, and data is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. One name of notable interest today is Micron Technology, Inc. (NASDAQ:MU), where option traders are rolling the dice on round-number support.

Most Active Weekly Options Table

Ahead of this afternoon's presentation at the UBS Global Technology Conference -- and following reports the company's chief financial officer is retiring -- Micron Technology, Inc. has tacked on 2.3% to trade at $33.04. Since hitting their most recent low of $26.32 in mid-October, shares of MU have rallied roughly 25%, and reclaimed their perch atop the round-number $30 mark along the way. Against this backdrop, a number of speculators in today's session are gambling on this area to serve as a short-term floor over the next several weeks.

Specifically, the equity's weekly 12/5 30-strike put has received notable attention today, with 1,000 contracts on the tape at last check. All of these puts have gone off on the bid side, implied volatility is up 2.4 percentage points, and volume outstrips open interest -- making it safe to assume a fresh batch of short positions is being initiated.

As touched upon, the expectation for today's put writers is for MU to stay north of $30 through the close on Friday, Dec. 5, when the weekly series expires. Delta on the put is currently docked at negative 0.12, suggesting a slim 12% chance the option will be in the money at expiration.

From a wider sentiment perspective, option traders have used puts in a more traditional sense in recent months, per the stock's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.32, which ranks in the 76th annual percentile. Simply stated, puts have been bought to open over calls at a faster-than-usual clip of late. Should Micron Technology, Inc. (NASDAQ:MU) continue to make its way up the charts, an unwinding of the hedges related to these bets could help fuel the security's fire.


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