By David Russell of OptionMonster
Nucor (NUE) broke out yesterday, and the bulls piled in.
OptionMonster's tracking systems detected the purchase of 8,400 October $52.50 calls , most of which priced for $1.30. Volume was more than twice open interest at the strike, which indicates new money was put to work on the long side.
Calls lock in the price where investors can buy the steelmaker, which provides them with cheap exposure to a rally. (See our education section.) This can result in significant leverage if shares move in the right direction.
Nucor rose 2.84% to $52.49 yesterday. It's now back above its 200-day moving average and is attempting to rouse itself from a year of sideways movement. Other related companies like United States Steel (X) and Steel Dynamics (STLD) have been strong recently.
Total option volume was 10 times greater than average in the session, with calls outnumbering puts by 11 to 1.
(A version of this post appeared on InsideOptions Pro yesterday.)