This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Southwestern Pullback Draws Bulls

By David Russell of OptionMonster

NEW YORK -- Southwestern Energy (SWN) has pulled back, and the bulls are stepping in ahead of its earnings report at the end of this month.

OptionMonster's tracking programs detected the purchase of almost 13,000 August 45 calls Wednesday, most of which priced for 49 cents to 60 cents. Volume was more than 100 times the strike's previous open interest, which indicates that new money was put to work.

These long calls lock in the price where investors can buy stock in the Houston-based natural-gas producer, letting them profit from a rally with limited risk. The contracts can also generate significant upside leverage, but they will expire worthless if the stock remains below $45 through mid-August.

Southwestern rose 2.33% to $43.39 Wednesday. Shares are down from above $49 in April but are attempting to bounce near their 200-day moving average. Quarterly results are scheduled for July 31.

Total option volume in the name was 14 times greater than average in the session, with calls outnumbering puts by a bullish 26-to-1 ratio.

Russell has no positions in SWN.

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.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $130.28 0.00%
FB $81.53 0.00%
GOOG $565.06 0.00%
TSLA $218.42 0.00%
YHOO $44.52 0.00%

Markets

DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports