Steel stocks are surging.
Since hitting their lows last week, shares of United States Steel and AK Steel have rallied a respective 20 and 35 percent. And if the options market is any indication, one of these names has a lot more room to run in the near term.
On Monday, when U.S. Steel rallied nearly 9 percent, options call volume ran more than two times its daily average. One trade that stood out involved a trader betting that U.S. Steel could see a super surge in the next month. Specifically, that trader purchased more than 10,000 of the November 14-strike calls at an average price of 42 cents. Since buying a call is a bullish strategy that allows one the right to buy a stock at a set price for a given time, this is a bet that U.S. Steel could rise above $14.42, or more than 25 percent, by mid-November.