Option Bulls Predict Fast Start to 2015 for Facebook (FB)

Facebook Inc (FB) call buying continues to be popular

Digital Content Group
Dec 31, 2014 at 1:27 PM
facebook X logo linkedin

Facebook Inc (NASDAQ:FB) is bucking the broad-market trend higher this afternoon, down 0.3% at $78.96. Over the past few months, the shares have struggled in the $80 area, and after ending last Friday above this round-number level, they've given back 2.3% week-to-date. Nevertheless, options traders today are rolling the dice on a record high early in the new year.

Taking a quick step back, short-term contracts are in high demand, based on FB's 30-day at-the-money implied volatility, which is up 5.7% to 39.5%. Along those lines, call buyers are initiating fresh positions at the stock's January 2015 85-strike call, where nearly 12,500 contracts are on the tape -- making it the social network's most active option. In other words, these bullish bettors expect FB will topple $85 -- putting it in record-high territory -- by the close on Friday, Jan. 16, when front-month contracts expire.

Today's penchant for call buying is by no means unusual. During the last 10 days at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), FB has racked up a call/put volume ratio of 2.72, indicating nearly three calls have been bought to open for every put. What's more, this ratio ranks higher than four-fifths of comparable readings from the past year.

This extreme optimism potentially leaves Facebook Inc (NASDAQ:FB) vulnerable. If the shares continue to struggle around $80, the weaker bullish hands may decide to hit the exits, which could result in additional headwinds.


Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI