Options Traders Eye Bigger Gains for Fitbit Stock

FIT options traders have been unusually call-skewed in recent months

Aug 27, 2018 at 3:11 PM
facebook X logo linkedin


Amid a broader rally in tech stocks, Fitbit Inc (NYSE:FIT) is trading up 4% at $6.28. The surge has sparked a rush of activity in FIT's options pits, with total volume running in the 99th annual percentile. The action appears to be one-sided, too, with call volume of 39,514 contracts dwarfing the 5,597 puts traded so far -- and representing four times the intraday norm.

Most of the activity has centered at the weekly 8/31 series, which expires at this Friday's close. Speculators appear to be purchasing new positions at the 5-strike, 6-strike, and 6.50-strike calls -- with more than 20,000 contracts already traded at the former -- betting on Fitbit shares to extend today's rally into the holiday weekend.

This call-skewed trading just echoes the withstanding trend seen among Fitbit options traders. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 50-day call/put volume ratio of 6.28 ranks in the 100th annual percentile, meaning calls have been bought to open over puts at a quicker-than-usual clip.

While some of this could be at the hands of bullish options traders, it's also possible short sellers have been buying out-of-the-money calls to hedge against any upside risk. Short interest on FIT jumped 14.5% in the most recent reporting period to 40.56 million shares -- a whopping 21% of the security's available float.

Looking at the charts, today's surge extends the stock's recent bounce near $5.14, home to its negative 10% year-to-date return. In fact, FIT is now 10% higher in 2018, and is on track to close north of its 50-day moving average for the first time since July 19.

fitbit stock daily chart aug 27

 

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