Options Traders Bet Big On JD.com

JD.Com Inc JD broke bullish on Tuesday from a descending channel that had been pushing its stock down since Feb. 17 when it made a new all-time high of $108.29.

The Chinese online retailer and internet company’s stock then consolidated on Wednesday and Thursday, tagging the eight-day exponential moving average and bouncing from it. Options traders believe the bottom is in for JD and bet over $6.71 million its shares are headed higher.

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Why It’s Important: When a sweep order occurs, it indicates the trader wanted to get into a position quickly and is anticipating an imminent large move in stock price. A sweeper pays the market price for the call option instead of placing a bid, which sweeps the order book of multiple exchanges to fill the order immediately.

These types of call option orders are usually made by institutions, and retail investors can find watching for sweepers useful because it indicates “smart money” has entered into a position.

The JD.com Option Trades: Below is a look at the notable options alerts, courtesy of Benzinga Pro:

• At 10:25 a.m., Thursday a trader executed a call sweep, near the ask, of 1,749 JD.com options with a strike price of $77.50 expiring on Sept. 17. The trade represented an $857,010 bullish bet for which the trader paid $4.90 per option contract.
• At 10:25 a.m., a trader executed a call sweep, near the ask, of 1,648 JD.com options with a strike price of $77.50 expiring on Sept. 17. The trade represented an $817,408 bullish bet for which the trader paid $4.96 per option contract.
• At 10:25 a.m., a trader executed a call sweep, near the ask, of 2,385 JD.com options with a strike price of $77.50 expiring on Sept. 17. The trade represented a $1.21 million bullish bet for which the trader paid $5.09 per option contract.
• At 10:25 a.m., a trader executed a call sweep, near the ask, of 841 JD.com options with a strike price of $77.50 expiring on Sept. 17. The trade represented a $428,910 bullish bet for which the trader paid $5.10 per option contract.
• At 12:13 p.m., a trader executed a call sweep, near the ask, of 5,000 JD.com options with a strike price of $115 expiring on Oct. 15. The trade represented a $400,000 bullish bet for which the trader paid 80 cents per option contract.
• At 12:19 p.m., a trader executed a call sweep, near the ask, of 3,001 JD.com options with a strike price of $77.50 expiring on Sept. 17. The trade represented a $1.52 million bullish bet for which the trader paid $5.09 per option contract.
• At 12:19 p.m., a trader executed a call sweep, near the ask, of 1,758 JD.com options with a strike price of $77.50 expiring on Sept. 17. The trade represented an $896,580 bullish bet for which the trader paid $5.10 per option contract.
• At 12:19 p.m., a trader executed a call sweep, near the ask, of 1,134 JD.com options with a strike price of $77.50 expiring on Sept. 17. The trade represented a $589,680 bullish bet for which the trader paid $5.20 per option contract.

JD Price Action: Shares of JD closed Thursday down 1.33%. at $75.52.

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