Traders who were bullish on Twitter are starting to rethink their position on the social media giant, based on what happened in the options pit.
Twitter's shares saw six times more call volume than that of puts on Thursday, (meaning more options to buy traded hands than options to sell) but the outlook wasn't as bullish as that may imply.
In fact, one trader decided to take his profits on Twitter after two big winning sessions, selling a large holding of call options that had increased in value thanks to takeover speculation.
That and similar trades led Dan Nathan to conclude traders see that Twitter's rally could be over.
"From the estimation of the activity today, it looked to be that traders were taking profits," Nathan said Thursday on CNBC's "Fast Money. "
But not all hope is gone for the company. Nathan looked at a one-year chart of Twitter and concluded that a "golden cross" pattern was forming. The pattern is seen to be an indication of bullish activity ahead, and in this case Twitter's 50-day moving average rose above its 200 day. This, Nathan says, could be an indication that the stock is on the rise.
Twitter rallied more than 10 percent over Wednesday and Thursday, but was nearly flat in Friday trading.