Call Traders Jump on eBay Stock's Breakout – Schaeffers Research

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Just this morning eBay Inc (NASDAQ:EBAY) announced it would hold a “crash sale” on July 15 in the annual attempt to compete with Amazon.com’s (AMZN) Prime Day, which this year will actually be two days, spanning July 15 and 16. This comes as EBAY stock has rallied to fresh high, hitting a 52-week peak of $40.55 last week, while it sports a year-to-date lead of 39%. This strong price action has gotten the attention of bullish options traders.

Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows a 10-day call/put volume ratio of 8.10, which not only means more than eight long calls crossed for every put, but the reading ranks in the 94th annual percentile, showing such a preference for long calls is unusual.

A large portion of this action took place at the July 43 call, and data confirms heavy buy-to-open activity here. In fact, the recent attention for the strike has put it as the second most populated of all EBAY option. Meanwhile, put open interest is close to an annual low.

Finally, analyst attention is split on the e-commerce concern, with half in coverage recommend the shares as a “buy” or “strong buy,” while the others have just “hold” recommendations. eBay is currently trading right in line with its average 12-month price target of $39.99, last seen trading at $39.19.