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Big trader is looking for rebound in Intel

Mike Yamamoto | Managing Editor, OptionMonster
Monday, 19 Aug 2013 | 6:00 AM ET
A visitor walks past a notebook showing the Intel logos during the 2013 Computex in Taipei on June 4, 2013.
Mandy Cheng | AFP | Getty Images
A visitor walks past a notebook showing the Intel logos during the 2013 Computex in Taipei on June 4, 2013.

A large trader is looking for Intel to rebound as it tries to hold onto a key technical level.

Intel was down 0.52 percent to $21.92 on Friday, the second consecutive close below its 200-day moving average. The chip maker gapped down from above $24 on July 18 after missing second-quarter estimates on weak PC sales, and the stock has continued to trend lower trending lower since.

OptionMonster's tracking systems detected the purchase of 13,000 September 25 calls for $0.03 and the sale of 13,000 September 19 puts for $0.02. So the trader is paying a penny to ride a rally through the long calls, but the short puts mean that he or she would be on the hook to buy shares around $19 if they fall below that level by expiration in mid-September.

Can Intel move away from PC?
Peter Gleissner, European director at Intel, discusses Intel's quarterly results and the strategy to develop different types of devices, such as smartphones, tablets, wearables and TV.

Total option volume in Intel was nearly 5 times its daily average for the last month. Overall calls outnumber puts by 5.5 to 1.

—By CNBC Contributor Mike Yamamoto

Additional News: Intel cutsannual revenue forecast amid slump in PC sales

Additional Views: Worries over Intel are overblown: Pro

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Disclosures:

Mike Yamamoto is managing editor at OptionMonster. Yamamoto has no positions in INTC.

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