Facebook, Inc. (FB) Call Buyers Won't Quit

Facebook Inc (FB) traders are banking on an end-of-week rebound

by

Published on Mar 10, 2015 at 12:13 PM
Updated on Apr 20, 2015 at 5:32 PM

Facebook Inc (NASDAQ:FB) call buying has been in vogue recently at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). During the last two weeks across this trio of exchanges, the stock has racked up a call/put volume ratio of 3.56 -- higher than any other reading from the last year.

Calls are again the options of choice today, with the contracts more than doubling puts. Digging deeper, buy-to-open activity is detected at the weekly 3/13 79.50- and 80-strike calls, where a collective 13,600-plus contracts have crossed. In short, the buyers anticipate FB will topple the respective strikes by this Friday's close, when the weekly series expires.

This optimism is understandable, considering the equity hit a year-to-date high of $81.99 last Thursday. This mark is also within a chip-shot of FB's all-time peak of $82.17, touched in late December.

What's more, the security took a bounce off its 50-day moving average this morning, which roughly corresponds with high levels of put open interest at the March 77.50 strike. In other words, the underlying could benefit from technical and/or options-related support going forward.

Around midday, Facebook Inc (NASDAQ:FB) is sitting on a 1.4% deficit at $78.35. However, it appears this has less to do with specific company developments than it does with today's broad-market struggles.

Daily Chart of FB since September 2014 with 32-Day Moving Average


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