Bullish Option Activity Alert: CHTP
Bullish Option Activity Alert: CHTP
Chelsea Therapeutics International Ltd. (CHTP), the Charlotte, NC-based biopharmaceutical development company, sees its shares trading 23% higher this morning following news that the company will be filing a new application for its Parkinsonís drug Northera. Option activity has surpassed 10,000 contracts, more than 100 times its daily average, with the trading reflecting a continued Bullish sentiment. The June 5 Calls have seen 3,500 contracts trade, 85% on the offers, while the June 4 Puts have seen the same contract volume but with all the activity on the bids. The noted Calls carry an average cost of $.42 and will need CHTP to trade above $5.42, or 10.6% higher, over the next 2 months to reach breakeven while the Puts need the shares to remain above $4.00 at expiration for the seller to pocket the premium collected today.
Chelsea Therapeuticsí shares have had a dismal start to 2011, trading down as much as 53%, as investors got frustrated with disappointing trial results. The company is scheduled to release its Q1 earnings on April 25th with analysts looking for a per/share loss of $.23.
About Patrick (Rick) Mortimer
Patrick(Rick)Mortimer is the Director of Options Trading at Pipeline Trading Systems LLC. With over 25 years of options trading experience as a Broker/Market Maker on the Philadelphia Stock Exchange he now provides daily insight into today’s complicated world of equity options trading. His daily alerts and commentary are valued by institutional asset managers and hedge funds and he is often quoted by well known financial news providers such as Bloomberg, CNBC, and Reuters. Pipeline’s equity and options clients have found his analysis useful in providing option strategy’s to increase alpha for current equity holdings as well as forecasting directional stock movement based on the underlying option activity.
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