Reliance Steel Bulls Forge Ahead

By Pete Najarian, co-founder of OptionMonster

NEW YORK ( OptionMonster) -- Option activity has turned bullish on Reliance Steel & Aluminum ( RS) ahead of its earnings report next week.

The December 38 calls saw some quick action, followed by more than 2,000 December 41s in some big chunks for $2, according to OptionMonster's real-time tracking systems.

The trades lock in an entry price on the stock so that if the shares climb, the options will move even more. The calls traded with the shares down about 1% shortly after the open, but Reliance's stock then pushed its way higher and closed the session up 4.05% to $39.55.

The company provides metal-processing services and distributes more than 100,000 products to customers in a range of industries. Its quarterly results are scheduled for Oct. 27.

More than 3,600 calls traded against 200 puts at all strikes in the name, a reflection of the bullish sentiment.

Najarian has no positions in RS.

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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