Traders may be shopping for a drop in American Eagle Outfitters, which has been trending lower for almost a year.
OptionMonster's tracking systems detected the purchase of some 6,500 August 19 puts, most of which priced for $0.35 to $0.45. Volume was more than twice previous open interest at the strike.
Puts lock in where shares can be sold, giving them a strong inverse correlation to the underlying price. They'll gain in value if the retailer continues to fall, letting investors hedge long positions in the stock or speculate on a selloff.