Are Chesapeake Energy Corporation (CHK) Shorts Feeling the Heat?

Chesapeake Energy Corporation (NYSE:CHK) is enjoying a halo lift from Freeport-McMoRan Inc (NYSE:FCX) this afternoon, and was last seen 1.4% higher at $13.69. Against this backdrop, call players are rushing the equity's options pits -- with volume running at 1.7 times the average intraday pace -- and it appears a number of these speculators are rolling the dice on additional gains over the next two weeks.

Specifically, CHK's weekly 3/27 14.50- and 4/2 15-strike calls have garnered the most attention, and it looks as if a healthy portion of the activity here is of the buy-to-open kind. For those initiating new long positions, the expectation is for the security to rally north of the strikes by the respective expiration dates.

It's a bit surprising traders are so quick to purchase new call positions on an equity that has been a long-term laggard. In fact, over the past 52 weeks, CHK has shed more than 41% of its value, and hit an analyst-induced two-year low of $13.38 yesterday.

With a healthy 10.8% of the security's float sold short, then, some of today's out-of-the-money call buying could be a result of shorts hedging against any additional upside. In fact, even with today's move higher, Chesapeake Energy Corporation's (NYSE:CHK) 14-day Relative Strength Index (RSI) is docked at 29 -- in oversold territory -- suggesting a bigger near-term bounce may be in the cards.