Will The Blackstone Group Rally 40%?

Shares of The Blackstone Group

are trading higher on the session by 1.53%, at $16.62. The stock has been on a nice, upward trajectory over the past three months following a bottom at $12.40. Despite that solid move, long-term players are still playing BX from long side. Notably, LEAP call options have been purchased today. The strike seeing the heaviest action today is the January 2014 $22.00 call, which has traded 7,862 times on open interest of only 9 contracts. This indicates few positioning. Interesting to note is that over 90% of all calls traded in The Blackstone Group today have been purchase on the offer. Call volume itself is running at 2x normal volume. The technicals favor an upside move in BX—in the short-term view, as well as the long term. Short-term, given the upward sloping 20-day and 50-day moving averages, as well as the consistent consolidation/breakout patterns in the name, BX looks ripe to pop above $17.25. Long-term, now that shares have regained the massive $16.00 pivot, BX has a major support level below it. With upward sloping moving averages (the 200-day is still downward sloping, though the stock trades firmly above it; it is thus a matter of time before this tilts higher as well), as well as strong buy-side momentum, The Blackstone Group could breech the 52-week high ($19.63) in as little as three months. Given the hefty dividend (5.30%, paid quarterly) the best way to play the name may be by simply purchasing stock. The Blackstone Group L.P. is a manager of private capital and provider of financial advisory services. Blackstone is an independent manager of private capital with assets under management of $128.1 billion, as of December 31, 2010.