Hewlett-Packard Continues Its Surprising Rebound

Last-minute buying in Hewlett-Packard By Pete Najarian, co-founder of OptionMonster

NEW YORK -- Hewlett-Packard (HPQ) is continuing its surprising rebound, and last-minute buyers stepped in Tuesday in search of even more gains.

About 5,000 April 23 calls were purchased, most of them in the final 45 minutes of the session for 21 cents, according to OptionMonster's real-time tracking systems. Open interest in the strike was 2,202 contracts before the session began, indicating that Tuesday's action was fresh buying.

The computing giant's stock rose 1.76% Tuesday to close at $21.40. It hit a decade low of $11.43 last November but gapped higher on quarterly results last month and has been rising ever since.

The calls bought Tuesday, which lock in the price where traders can buy the stock, are looking for the stock to climb above $23 by mid-April. They can provide significant leverage in the event of a rally but can expire worthless if shares remain below that strike price.

Najarian has no positions in HPQ.

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.