By Mike Yamamoto of OptionMonster
NEW YORK -- The energy bulls were out in force Monday, and ConocoPhillips (COP) was their target in the afternoon.
More than 16,400 March 70 calls traded in a strong buying pattern as premiums rose from 10 cents to 19 cents, according to the OptionMonster's tracking systems. Open interest in the strike was just 2,193 contracts before the session began, indicating that new positions were established.
These long calls lock in the price where the stock can be purchased for the next four weeks no matter how far it might climb. They could be sold earlier if premiums rise with a rally before then, but the contracts will expire worthless if shares remain below $70.
Must Read: Bulls Hope Joy Will Live Up to Its Name
ConocoPhillips' stock gained 2.69% Monday to close at $66.42. The oil and natural-gas company had been trending lower since hitting an all-time high of $74.59 last October and fell after its last earnings report on Jan. 30, but it bounced at the $63 level this month and has been trading sideways since.
Total option volume in the name was just shy of 37,400 contracts, more than seven times its daily average for the last month. Overall calls outpaced puts by 4 to 1, reflecting the session's bullish bias.
Yamamoto has no positions in COP.