Protection Purchased in Motorola

Motorola (NYSE: MOT) has stumbled a bit as of late, retreating from a recent high of $7.67 to its current price of $7.16. The stock looks like it may hold the critical resistance-come-support level of $7, but one large, institutional trader is buying protection just in case. The May $7 put was purchased on the bid 20,000 times today; this action surpassed the open interest of 17,000 contracts indicating new, opening positioning. This can be considered bullish though, given that a large player can now resist the urge to sell shares around $7 now that they own protection.

Motorola’s prospects seem bright with a possible break coming to the company, which would let the real high growth segments shine; I tend to be bullish on the stock. In fact, in the June contract the $7 calls traded on the offer; volume was above open interest, though only 5,100 contracts traded.

Motorola is scheduled to report earnings on the 29th of April