LG Display Stock Pops on Apple Report

Options volume has exploded as a result of the major partnership

by Patrick Martin

Published on Sep 14, 2018 at 12:10 PM

While one Apple supplier struggled in the aftermath of Wednesday's iPhone and Apple Watch reveal, another stock soared on news of a partnership with Apple (AAPL). Shares of LG Display Co Ltd. (NYSE:LPL) are up 3.2% to trade at $9.38, after Apple reportedly chose the company to be its second OLED supplier. In response, LPL options traders are piling on.

LG Display calls are all the rage today. More than 1,000 calls have been traded -- 27 times what's typically seen at this point in the day, with volume pacing for an annual high. Most active is the October 10 call, where it appears that new positions are being opened for a volume-weighted average price (VWAP) of $0.35. If this is the case, breakeven for the call buyers at expiration is $10.35 (strike plus premium paid).

This bullish bias has been a trend for the past two weeks, despite relatively light absolute volume. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day call/put volume ratio ranks in the 97th annual percentile, indicating the rate of call buying relative to put buying is hovering near extreme levels.

On the charts, LG Display stock is on track to snap a three-week losing streak. Since bottoming at a June 28 intraday low of $7.77, LPL has fought back to add 21%. Despite the rally though, the shares will need more tailwinds to take out resistance at their 100-day moving average, which has served as stubborn resistance lately.

Daily Stock Chart LPL

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