Thursday, March 12, 2009

Amazon.com (AMZN) Sees Increase in Put Trading

Amazon.com (AMZN: sentiment, chart, options) was the center of some heavy put trading on Monday, as the stock's Schaeffer's put/call open interest ratio popped overnight from 1.30 (in the 48th annual percentile) to its current perch of 1.37 (in the 54th annual percentile).

The International Securities Exchange (ISE) reported some heavy put buying, as more than 7,100 put contracts were purchased to open on the exchange, compared to just 3,187 calls purchased to open. In other words, 2.2 puts were purchased to open for every 1 call purchased to open.

In particular, the March 55 put added approximately 3,500 new positions on Monday. Open interest at this strike now stands at 10,504 contracts.

In today's action, traders have turned to the stock's calls. The March 65 call has seen more than 6,100 contracts cross the tape today, making it the most active front-month strike. Open interest for this option currently stands at 14,881 contracts. Today's volume has crossed in a number of small blocks.

Meanwhile, the most active front-month put is the March 60 strike, with 3,600 contracts changing hands. Open interest for this contract stands at 13,131 contracts.

In trading today, the shares of AMZN are up more than 5.3%, adding to their year-to-date gain of more than 20%. The security is still facing staunch short-term resistance in the 66-68 region.

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