Today I want to write about an interesting development in the WFT – Weatherford international stock. WFT is a typical Oil service stock and due to the increasingly harder environment for Oil stocks in the last year, also WFT fights with a declining stock price which is probably mostly owed to a declining Oil pricing, smaller project volumes in this market and therefore lower earnings.
If we take a look at the daily chart of WFT we can clearly see a downtrend that seems to break out due to the strong moves of the last 3 trading days:
Recently I noticed that in the JUL 21 expiring options the Open interest (OI) is at a very high level compared to other expirations. Also in the August 18th expiry, we have higher OIs but not even half the amount which we have in the nearest expiration. Another interesting factor is that this volume only seems to exist on the Call side of the options, see a Screenshot of the Options chain below:
Such high OI could be an indication of a developing Trade which mean in this case that the option traders are looking for higher prices until the 21th of JUL.
Possible reasons for this trade development:
- News on WFT Partnership
- possible M & A actions
Personally, I invested into WFT directly via stocks and some long options, if you like such or similar posts please let me know so I can bring more of it in the future.