Monday, January 11, 2010

Nexen (NXY) - Bullish Risk Reversal and Calls

NXY is a $10 billion Canadian energy company. The LIVEVOL™ Pro Summary is below.



The company has traded over 17,000 options today in the first three hours on total daily average option volume of 712. The Company Tab snapshot is below (click the image to enlarge).



The day's biggest trade is a sale of the Mar 30/20 risk reversal (buy calls/ sell puts) @ 0.16 net. The OI on both lines is substantially smaller than the trade sizes - these are opening positions. Someone is collecting 0.16 to get super long NXY if it goes through $30.

The next largest trade was a purchase of the Feb 25 calls - ~500 times total. Both of these trades are large opening bullish bets relative to average option volume. You can see the day's biggest trades and Options Tab snapshots below (click either image to enlarge).





The stock chart illustrates that the price has bounced around these levels for a number of months with no strong directional move. The Charts Tab snapshot is included below for reference.



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