Pitney Bowes has broken a long-term resistance, and option traders are betting that it will keep ripping higher.
optionMONSTER’s Heat Seeker tracking program detected the purchase of 5,000 January 30 calls for $1.80 and the sale of 5,000 January 25 calls for $3.80. Volume was below open interest at the lower strike, which suggests that a long position was closed and rolled to the higher strike.
Long calls lock in the price where a stock can be bought, letting investors cheaply position for gains while limiting the amount of capital at risk. They can also generate significant leverage if a rally ensues. Rolling to the January 30s allows the trader to receive a credit of $2 while keeping him or her exposed to further gains.
— Option Monster