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Bulls Hope United Continental Will Fly

By Pete Najarian, co-founder of OptionMonster

NEW YORK -- Traders targeted United Continental (UAL) early Monday and remained bullish throughout the session.

The airline carrier's stock fell 0.96% to close at $33.18, but upside options held their value.

The October 38 calls saw some big chunks trade shortly after the open for 22 cents, and volume continued higher to almost 5,600 by the closing bell, according to OptionMonster's tracking systems. Previous open interest in the strike was 3,739, indicating that new positions were established.

These long calls lock in the price where the stock can be purchased, letting investors cheaply position for a rally while limiting losses if it tanks. They're on the taxiway and can now rip higher if the stock surges.

Upside contracts outpaced the downside by about 11,000 to 2,900, a reflection of the session's bullish sentiment. Total volume in the name was twice its daily average.

Najarian owns UAL calls.

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.

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