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Twitter is soaring after a big sell-off this week. Here’s how high the stock could go

Twitter having its worst day in over a year but options traders are buying the dip

Twitter shares soared Wednesday after posting their worst session in over two years on Tuesday, and some traders are betting on more gains ahead.

Shares of the popular social media company were up 5 percent early Wednesday. They had plunged 10 percent on Tuesday following reports that the company could face new regulation abroad.

The social media space has been under pressure this week amid growing investor skepticism over Facebook's data-sharing scandal.

However, Dan Nathan of RiskReversal.com noted that options traders see Twitter's dip as a good buying opportunity for the stock.

"Options activity was three times [the] average daily volume," Nathan said Tuesday on CNBC's "Fast Money." "People were playing for above 35 over the next couple of months."

On Tuesday, one trader bought a block of 2,000 May 32 calls for $2.77. This is a bullish bet that Twitter shares will be above $34.77 by May.

Twitter has been on a tear this year, up more than 30 percent since January, and hit its highest level in two years last Wednesday. Nathan added that the technical setup for Twitter looks positive. "Look at [Twitter] at 30 bucks," Nathan said. "It looks like some good support there in the near future."

Twitter was trading around $33 early Wednesday afternoon.