Range-bound trade in Arch Coal

A big trade is looking for Arch Coal to remain range-bound through the middle of 2014.

optionMONSTER systems show that 6,000 each of the July 3 puts and July 6 calls have traded, both well above previous open interest and therefore new positions. The puts were sold for $0.23 and the calls for $0.26, both the bid prices at the time.

This short-strangle position will take its maximum gain if ACI is between $3 and $6 through expiration in mid-July.

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