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Bulls Follow Chesapeake Higher

Chesapeake Energy had a solid October, and the bulls are still active in the November options.

The primary focus in yesterday's session was on the Nov. 28 calls, as traders bought sizable blocks for $1.65 to $1.68. More than 7,300 of those contracts traded throughout the session.

Long calls lock in an entry price and are highly leveraged to movement in the share price. They can double or triple from the shares moving 5 percent to 10 percent, or expire worthless if the stock falls below the strike price.

The oil and natural-gas company's shares rallied 3.64 percent to $29.03 yesterday, so those options are already in the money. More than 50,000 options traded in the name yesterday, but fewer than 7,000 of them were puts, reflecting the overall bullish sentiment.

—Najarian owns CHK long calls.

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Pete Najarian is a professional investor, CNBC contributor, regular co-host of CNBC's "Fast Money" and co-founder of OptionMonster.com.

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