$AMZN call buyers score overnight

$AMZN call buyers score overnight


Option traders are posting fast profits today as Amazon.com (AMZN) rises.

On May 17Market Rebellion’s Unusual Option Activity Service found that 12,000 Weekly $116 calls, expiring this Friday, were bought for $0.81 to $1.32 with shares at $114.94. This was clearly fresh buying, as open interest in the contract was just 9,004 before the activity appeared.

Those calls have changed hands for $2.79 this session, a 111.36% return, while the stock rose 3.16% in the same time frame, illustrating the kind of leverage that can be achieved 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.

AMZN was last up by 1.87% at $117.66.

Ready to start trading? Try Unusual Option Activity Essential. Learn how you can follow the “smart money” with a fresh UOA trade idea each week – including technical levels so that you know how to manage each trade!

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