General Electric Company (GE) Weekly Put Traders Bet on a Floor

General Electric Company (GE) is higher today on news that it will sell restaurant finance assets

Jun 28, 2016 at 11:09 AM
facebook X logo linkedin


General Electric Company (NYSE:GE) is trading 1.5% higher at $29.75 after the company reported it would sell the majority of its restaurant financing assets in three separate deals. The stock has now added 11.7% over the past 12 months -- though it's still lower in 2016 -- compared to the S&P 500 Index's (SPX) 1.8% year-over-year loss. Recently, however, bearish bets on GE have been popular, and in the options pits, weekly contracts are gaining traction.

Across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock holds a 50-day put/call volume ratio of 1.37 -- in the 87th percentile of its annual range. That means speculators have been purchasing GE puts over calls at a faster-than-usual rate. Monday's session saw some further bearish action, too, as traders bought to open the weekly 7/8 29.50-strike put -- the day's most active option. Buyers of the put are looking for shares of GE to sink below $29.50 by next Friday's close, when the option expires.

Weekly options are hot again today, with the top two spots belonging to the weekly 7/22 29.5-strike put and 8/5 30-strike put. But by the looks of things, trader may be selling, rather than buying, new positions at these strikes. With today's bounce, these put sellers are expecting the $29.50 or $30 level to serve as a floor for the stock over the next month or so.

With peak open interest in the July series currently residing at the 30 put -- where a large majority of positions were bought to open -- the put sellers could be right, as an unwinding of these bearish bets as expiration approaches may serve as support for the shares. Plus, the $29.50 level limited the stock's recent pullback in May, after serving as resistance throughout February.

Outside of the options pits, General Electric Company (NYSE:GE) could stand to see some love from the brokerage bunch. At the moment, more than half of the analysts following the stock recommend holding or selling it.

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical levels, and top economic stories straight to your inbox.
 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI