Huge Call Buying Precedes Monster NQ Mobile Rally

Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show.

NQ Mobile Inc (ADR) NQ shares are trading higher by $0.52 at $5.06 in Wednesday's session. The issue has gained over 40 percent since closing at $3.56 on May 20.

That was the day following a mixed Q1 report, but was accompanied by stronger Q2 and FY 2015 guidance.

Over the next day, shares experienced huge volume in various call options, ranging from $3.5 to $4.5 in strike price with June and December expiration dates, according to Benzinga Pro.

Related Link: 1 Reason NQ Mobile Could Be Surging

By May 27, the stock had cleared the $4 level ending the session at $4.15 and remained at that level for a few days before resuming its rally on Tuesday leaping to $4.54. The momentum has continued in Wednesday's session off the opening bell and it has now climbed in $5 handle, so far reaching $5.14.

That marks the highest level for the issue since it peaked on December 18 at $5.53.

During the recent run, the only analyst move was made by Rosenblatt. On May 29, the firm initiated coverage with a Buy rating and a $8.10 price target.