Amid Downturn, SunPower Corporation (SPWR) Put Buying Picks Up

SunPower Corporation traders anticipate a move below $23 in the next couple months

Digital Content Group

Dec 30, 2014 at 2:27 PM

SPWR

SunPower Corporation (NASDAQ:SPWR) is off 1.3% this afternoon to trade at $25.80, bringing its year-to-date deficit beyond 13%. What's more, just overhead (at $26.20) the shares face a level of resistance in the form of their descending 30-day moving average. As such, at least one group of options traders is upping the bearish ante.

Today's most active SPWR strike is the February 23 put, where speculators are initiating long positions. In short, these traders are angling for the underlying to tumble back below $23 by the close on Friday, Feb. 20, when the back-month options expire. The shares briefly breached this level earlier this month -- hitting an annual low of $22.75 -- before bouncing to their current perch.

Today's put buying is business as usual for SunPower Corporation (NASDAQ:SPWR). The stock's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio rests at an annual high of 4.66. In other words, traders have been buying to open SPWR puts over calls at a much faster-than-usual rate in recent weeks -- quite the change from the last time we covered the security.

Follow @Schaeffers

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released!