Unusual Activity In STX Weekly Options – Still More Room To The Upside?

Seagate Technology (Nasdaq: STX, $67.91) has outperformed the overall tech sector in 2014, with shares having risen 20.5% year to date versus 17.8% for the sector overall. 

STX shares have traded in a 52-week range of $48.21-$69.42, with 2.8 million shares changing hands each day on average.  STX hit its all-time high of $69.40 one week ago on December 23. 

At least one trader has a high level of conviction STX will carve out new highs before week’s end.  With just over an hour left in Monday’s session, a trader bought 3,000 STX Jan Weekly 67.5, calls expiring this Friday for $1.14 with stock trading $68.31. 

An opening position, this represents a $342,000 outlay in long premium with the potential to control 300,000 shares of stock, should these calls be in-the-money at Friday’s expiration. 

Since this trader bought these calls, STX has sold off and these calls are trading about $0.80.  True believers in unusual options activity might use this sell-off as an opportunity to follow along at a lower price.