Wal-Mart shares have fallen 14 percent since the start of the year but some traders have been betting the stock will rally in the next month.
Over the past two days, traders placed twice as many bullish bets on the world's largest retailer than bearish ones in the options market. Some 17,000 contracts traded on the July 75-strike calls on Thursday for an average price of $1.21.
Since each contract controls 100 shares, nearly $2.1 million was bet that Wal-Mart shares will trade above $76.21 or 3 percent above Thursday's close in the next month. A call is a bullish bet giving the purchaser the right to buy a stock at a set price within a given time frame.
Wal-Mart has fallen 18 percent from its all-time highs of $90.97 on Jan. 13. But according to options expert Dan Nathan, co-founder of RiskReversal.com, the traders who bought the 75-strike calls are merely betting the stock will bounce from a major support level while staying in its long-term range.