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Canadian Solar Inc. (CSIQ) Option Bulls Shoot for Higher Highs

Canadian Solar Inc. (NASDAQ:CSIQ) hasn't traded above $42 since March 2014

May 11, 2015 at 10:59 AM
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Canadian Solar Inc. (NASDAQ:CSIQ) is following its sector peers higher today, last seen up 6.2% at $39.40. In the options pits, call volume has soared to three times what's typically seen at this point in the day, with a number of speculators rolling the dice on more upside through week's end.

Specifically, the stock's May 42 call has garnered notable attention, and it appears a portion of the activity is of the buy-to-open kind. In other words, speculators are betting on CSIQ to rally north of $42 through this Friday's close -- when front-month options expire. A move north of $42 will mark a fresh annual peak for CSIQ.

Today's accelerated call activity runs counter to the withstanding trend seen in CSIQ's options arena. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the security's 10-day put/call volume ratio of 0.68 ranks in the 82nd annual percentile, meaning puts have been bought to open over calls at a faster-than-usual clip in recent weeks.

Echoing this is CSIQ's Schaeffer's put/call open interest ratio (SOIR) of 1.18, which rests just 4 percentage points from a 52-week peak. In other words, short-term speculators have rarely been as put-heavy toward the equity as they are now.

On the charts, today's rally just mirrors the stock's longer-term technical prowess, with CSIQ boasting a 63% year-to-date lead. In light of this, some of the recent put buying -- particularly at out-of-the-money strikes -- may be a result of shareholders hedging against any unexpected downside. Off the charts, Canadian Solar Inc. (NASDAQ:CSIQ) will be in attendance at the  Deutsche Bank Clean Tech, Utilities and Power Conference today and tomorrow.
 

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