Bulls keep scoring with $QCOM

Upside option positions in Qualcomm (QCOM) that expire tomorrow afternoon are rewarding bullish traders today for the second time.

On Jul. 21, Market Rebellion’s Unusual Activity Service identified the purchase of 6,500 Weekly $105 calls, expiring on Jul. 31. for $0.21 to $0.30 as part of a bullish spread with shares at $92.17. This was clearly fresh buying, as open interest in the strike was only 361 contracts before the activity appeared.

Those calls have traded for as much as $3.10 so far today, nearly 10 times their average purchase price. The stock rose 16.39% in the same time frame, illustrating the kind of leverage that can be achieved quickly with options.

Long calls lock in the price where a stock can be purchased, gaining with a rally and providing leverage to the underlying shares. The contracts can quickly lose value if the stock stalls or pulls back but also carry less risk than owning the shares themselves.

QCOM was last up 14.08% to $106.13 this afternoon, setting new highs since an earlier posting on Market Rebellion where other Weekly call positions had outperformed shares on the upside, following the company’s earnings report.