By David Russell of OptionMonster
NEW YORK -- Foot Locker (FL) has been one of the stronger retailers, and Wednesday the bulls were shopping for more gains.
OptionMonster's tracking programs detected the purchase of 10,000 March 40 calls for $1.10. Traders also gobbled up 10,000 March 42 calls for 45 cents. Volume was more than 100 times above the previous open interest in each strike, indicating that new money was put to work on the long side.
These calls lock in the price where the stock can be purchased, letting investors cheaply control a move to the upside. The options can also generate significant leverage if the shares rally.Foot Locker shares gained 1.42% to $39.40 on Wednesday. The stock rose sharply between October and January, pulled back with the rest of the market last month, bounced at its 100-day moving average, and has been working higher since. Earnings also beat expectations on Nov. 22. Total option volume in the name was 63 times greater than average in the session, with calls outnumbering puts by 61 to 1. Russell has no positions in FL.