Drug News Shoots Array BioPharma Inc. (ARRY) Higher, Bulls Swarm

One trader is upping the bullish ante on Array Biopharma Inc (ARRY)

Digital Content Group
Jan 23, 2015 at 3:05 PM
facebook X logo linkedin


Array Biopharma Inc (NASDAQ:ARRY) hit a six-year high of $7.58 earlier, thanks to news it has acquired the rights to experimental cancer drug encorafenib from Novartis AG (ADR) (NYSE:NVS). ARRY was last seen 37% higher at $6.91, and activity has picked up in its options pits, with contracts crossing at 34 times the typical intraday rate.

Taking a closer look, calls have outnumbered puts by a margin of nearly 2-to-1. Much of this activity may be due to one trader who appears to have upped the bullish ante by liquidating her now in-the-money June 5 calls, in order to buy to open the June 7 contracts. This trader expects ARRY to hit even higher highs north of $7 by the close on Friday, June 19, when the monthly series expires.

According to the stock's Schaeffer's put/call open interest ratio (SOIR) of 0.25, near-term options traders are more call-skewed than at any point in the past year. Though, with over 19% of ARRY's float sold short -- representing over two weeks' worth of buying pressure, at the stock's average daily volume -- some of those calls may have been bought by bears hedging their bets.

On the analyst front, Array Biopharma Inc (NASDAQ:ARRY) is surrounded by optimism. All six covering brokerage firms rate the equity a "strong buy," presumably impressed by its technical strength of late. ARRY has outperformed the S&P 500 Index (SPX) by 34.5 percentage points in the past three months, and thanks to today's pop, is safely north of recent congestion in the $5 region.

Daily Chart of ARRY Since November 2014
 

Unlock Weekend Profits with Chris Prybal's Favorite Strategy Up +487.5% in 2024

With the markets going left, right, and sideways, you need to have a plan now more than ever. 

Expert Trader Chris Prybal is no stranger to volatility, and has mastered finding big stock rallies while other traders aren't looking over the weekend. Rallies that produced gains like +207% on RTX calls, +236% on MARA calls, and +238% on NET calls.

A few simple moves on Sunday at 7pm could be the “Secret Sauce” your portfolio needs to not just stay afloat, but make unprecedented gains in this turbulent market.


Don’t sit on the sidelines, beat the market with Chris Prybal's strategy. Join him now!