Is a Rally Brewing at Starbucks?

By Pete Najarian, co-founder of OptionMonster

NEW YORK -- Upside calls in Starbucks ( SBUX) lit up OptionMonster's screens Wednesday as traders looked for a jolt higher.

The option action wasn't screaming, but it was definitely bullish as the April 49 calls met with buyers for $1.29. Traders then targeted the April 52.50 calls for 23 cents and 25 cents, according to OptionMonster's real-time tracking systems.

Calls lock in the price investors must pay to buy shares. That can provide major leverage to the stock price going up, but they can also expire worthless if it doesn't move in the right direction.

Starbucks shares rose 2.4% to $49.49 Wednesday, and those calls were also up by the end of the session. The stock has been advancing steadily since the summer and is now pushing to new all-time highs.

Almost 7,000 calls traded against 4,000 puts Wednesday. So I guess I am not the only coffee freak on the planet!

Najarian has no positions in SBUX.
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.