How much truth is there in this, I am not sure but I thought this may be worth highlighting.
- WPI (Watsons) Pharmaceuticals is making a new 52wks high. There is rumor that J&J probably may bid for the company for a good premium. July 35 calls are traded very heavily 1590 contracts trades vs open interests of 5!!
- IRF (International Rectifier) is rising today. There is heavy volume in 35 and40 July calls but not so much as in WPI. As I look at my scanner, the ratio or volume to open interest ratio is not that significant but then there is rumor for it’s buyout as well.
Rumor are always very risky to play, so play with caution. I am in both the underlying with a willingness to close at loss, if needed.
Profitable trading, OP