Yahoo Pullback Brings Out Buyers

Yahoo has pulled back, and buyers are jumping on board.

optionMONSTER’s Heat Seeker monitoring program detected the purchase of 10,925 March 35 calls for $1.88 and the sale of an equal number of March 37 calls for $1.06. Volume was below open interest at the higher strike, so there are two possible explanations for the activity.

One is that they bought the March 37s when the stock was higher and are now underwater on the trade. Swapping to the lower strike increases their leverage and lowers the price at which they will break even.

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