NEW YORK -- Option traders are turning bullish on U.S. Steel (X) - Get Report less than one week before earnings are released. 

OptionMonster's Heat Seeker system detected the purchase of more than 21,000 February 24 calls Thursday, dwarfing previous open interest of 6,405 contracts and indicating new positions. The calls initially fetched 57 cents and 58 cents but appreciated to as much as 90 cents by the afternoon,  a gain of more than 50%. 

That kind of leverage is possible because calls lock in the price where a stock can be purchased. Their cheap cost ensures that investors won't miss a rally while limiting the amount of cash at risk in the event of a pullback. 

U.S. Steel shares were down slightly when the trades hit but turned almost immediately and ended the session up 2.95% to $22.71. The heavily shorted stock, which trades for less than book value, was holding support at its lowest level since October 2013. Quarterly results are due after the closing bell next Tuesday, Jan. 27. 

Overall option volume in the name was quadruple average amounts in the session, with calls accounting for a bullish 78% of the total.

-- Written by David Russell of OptionMonster 

Russell has no positions in X.