Unusual Options Activity in JP Morgan $JPM

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Unusual Options Activity in JP Morgan JPM
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• Hi, My name is Steve and Im with Options Trading
  Research, today were reviewing our recently
  published article

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• Unusual Options Activity in JP Morgan JPM

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• As many of you know, unusual options activity can
  be a valuable indicator as to what traders are
  thinking, and more importantly, where these
  stocks are heading in the short-term.

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• This is something professional options traders
  pay a lot of attention to, and for good reason
  Unusual options activity can tip off big moves
  in a stock, either up or down.

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• So lets take a look at some interesting
  activity that caught our eye this week
• JP Morgan JPM a massive financial company
  focused on retail and institutional banking.

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• The company does over 50 billion in sales per
  year and earns 22 billion in profits. For a
  good description of the company

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• JPM is trading at 66.01, up 9 for the year.
  Thats 6 below the 52-week high, and 33 above
  the 52-week low.

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• So what does unusual options activity in JPM tell
  us?

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• JPM has had a better year than most banks,
  despite it being a relatively tough environment
  for financials for most of the year. The stock
  didnt get hit nearly as hard as its competitors
  did during the August correction.

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• The share price has generally climbed over the
  last several weeks after it became clear the Fed
  wanted to hike interest rates this year. Keep in
  mind, higher rates are a good thing for banks at
  the current level.

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• Heres the deal This week, a large amount of
  puts traded in JPM options. Keep in mind, a put
  option makes money when the underlying stock goes
  down before its expiration date.

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• Conversely, selling a put option is beneficial
  when a stock goes higher or stays neutral.

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• To be more specific, a trader sold over 4,700
  63.50 puts expiring on December 24th. These puts
  were sold for 0.79, resulting in total collected
  premium of close to 370,000.

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• The volume far exceeds the open interest, so this
  is definitely opening action.
• Heres the chart of JPM

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• As you can see, JPM didnt experience the massive
  selloff many other banks were hit with in August.
  It has since recovered all the lost ground and
  is flirting with highs for the year.

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• The share price is also trading well above the
  50-day moving average. As a matter of fact, the
  puts sold in todays block are almost right at
  the 50-day moving average.

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• That suggest it will provide strong support over
  the next several weeks, should a pullback occur.

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• Whats more, despite the stock posting 9 gains
  for the year, it is still trading at a very
  reasonable valuation. The current share price is
  just 11x earnings.

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• The put seller obviously feels JPM has a limited
  downside given the fundamentals (and technicals).

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• More Options Trading Ideas

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• Keep in mind, theres a lot more unusual options
  activity going on than what we discuss here. We
  just try to bring you what we feel are the most
  significant ones and the ones you might actually
  be able to make some money on!

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