Seeing an increase in put volume in Estee Lauder (EL, news, chart) late in the day. The stock is down $1.81 to $42.95, and not far from session lows of $42.70. There is no company specific news to explain the weakness and shares might simply be caught up in today’s equity market downdraft. However, it appears that some players are anticipating further weakness in EL. Total volume is running nine times the usual, with 9,100 puts and 462 calls trading on the day. The August 35s are the most actives. 5,025 contracts have traded. Open interest is zero and more than half of today’s volume is trading offerside. Meanwhile, another 1,200 of the August 40s traded, with open interest of 176 and two thirds of today’s volume also trading on the offer. Consequently, directional sentiment based on today’s total flow in EL is 63 percent bearish.
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Frederic Ruffy is a well-known trader, writer, and strategist who has spent years educating investors and creating intelligent, insightful, unbiased market observations that are frequently cited by the Wall Street Journal and other financial publications. As senior analyst, Fred provides frequent and regular notes and daily updates for activity of interest.