American Airlines Group Inc. (AAL) Trader Rolls Down Her Bullish Bet

It looks as if one American Airlines Group Inc (NASDAQ:AAL) trader rolled down her long August calls

May 26, 2015 at 2:23 PM
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It's been a rough ride for American Airlines Group Inc (NASDAQ:AAL) of late, with the shares off 13.7% month-to-date, due in part to last week's sector-wide sell-off. Today, the stock has dropped 2.2% to churn near $41.66 -- and is on pace for its lowest close since Oct. 31 -- following reports that a sinkhole has shuttered flights at the Dallas/Fort Worth International Airport. In the options pits, it appears one speculator is downwardly revising her bullish outlook amid AAL's recent decline.

Specifically, AAL's August 50 call has seen the most action, thanks to a 9,651-contract block that was bought earlier. This could be opening activity, according to Trade-Alert, and may be the result of one option trader rolling down a similarly sized block of August 57.50 calls to a lower strike. Regardless, the options market isn't too confident the August 50 calls will expire in the money, as delta is docked at 0.17.

Widening the sentiment scope reveals option traders have been scooping up calls over puts at a near-annual-high clip in recent weeks. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 10-day call/put volume ratio of 5.12 sits just 9 percentage points from a 52-week peak.

Elsewhere, 10 out of 13 analysts maintain a "buy" or better rating on American Airlines Group Inc (NASDAQ:AAL), with not a single "sell" to be found. Should the shares continue to struggle, a capitulation by option bulls and/or a round of downgrades could pressure AAL even lower.

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