Bulls Look for Tyson to Bounce

By David Russell of OptionMonster

NEW YORK -- Tyson Foods ( TSN) has fallen along with the broader market, and now the bulls are looking for a bounce.

optionMONSTER's tracking programs detected the purchase of 7,600 September 37 calls for $1.55 and $1.60, dwarfing previous open interest of just 72 contracts. That indicates new money was put to work on the long side.

Calls lock in the price where investors can buy the poultry processor's stock, letting them control a rally at minimal cost. They can also generate significant leverage if it shares moves in the right direction. 

Tyson rose 0.51% to $37.24 on Monday, but is down 6% in the last week. It attempted to rally on July 28 after revenue beat expectations, only to follow the S&P 500 lower since. It's now attempting to hold support at its 200-day moving average, which could make some chart watchers expect a bounce.

Overall option volume was four times greater than average in the session, with calls accounting for three-quarters of the total.

Russell has no positions in the stocks mentioned.

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.