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Jon Najarian IDs Unusual Call Buying in Telecom

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DocJ is always looking for unusual options activity, and his proprietary heat seeker has found something.

“I’m seeing a lot of activity, a lot of buying of the Jan 3 calls in Sprint and selling in the Jan 5 calls,” he says.

“Volume was 77,000 – that translates into 7.7 million shares."

That's pretty heavy volume. And it suggests by the third week of January, institutional investors expect Sprint to trade well above $3.

"It's a long-term bullish bet," he tells us.

Of course, the options trade begs the question if there's a fundamental catalyst behind the bet - something that would drive the bottom line?

Najarian thinks there is. Thursday, Sprint said its Virgin Mobile prepaid business would start selling the Apple iPhone later this month.

VIDEO0:0000:00
Trade of the Day: 'Sprint'-ing Towards a Rebound?

Posted by CNBC's Lee Brodie




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