Bullish action in oil, Exxon Mobile (XOM), Tough times for Amazon.com, Two bullish biotech bets, A leak in Leap?

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A leak in LEAP? Shares of both Leap Wireless (LEAP) and MetroPCS (PCS) spike late Monday after the Wall Street Journal reports that LEAP has hired advisors to consider putting itself up for sale. Consequently, options action is heating up for a second day. Bullish trading surfaced in both names Friday (see Premium). Today, as shares rally around the news, sentiment in LEAP seems mixed, as some traders are likely taking money off the table. Shares are up $1.54 to $14.73 and 12K contracts traded (8750 calls and 3020 puts). PCS gained 29 cents to $5.92 and recent trades include 1,141 Feb 7.5 calls at the asking price of a nickel.

Steel Dynamics (STLD) is seeing relative strength and increasing options action ahead of a February 3 (after market) earnings release. Shares of the steelmaker are up 4.8 percent to $15.90 and among the best gainers in the NASDAQ 100 late Monday. In the options, 9820 calls and 710 puts traded. One of the top trades of the day is a block of 1196 Feb 17 calls at 35 cents on ISE. It was part of a multi-exchange sweep of 2979 contracts and an opening customer buyer, according to ISEE data. A block of 2680 Feb 17 calls at the asking price of 40 cents on PHLX also looks like an opening buyer. 7000 contracts now traded. Implied volatility (average) is moving up to 55.8 percent, from about 56.4 late Friday.

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume

Exxon Mobile (XOM) is up 2.8 percent to $66.85 and one of the best gainers in the Dow Jones Industrial Average after the oil giant posted earnings that beat Street estimates. In the options market, a noteworthy trade is the Jan11 65 – 75 call spread, traded 14500X at $3.80. Recall that we saw the same spread trade at $3.40, 14500X Friday, and today’s action might add to that position on the heels of the better-than-expected results (it’s also possibly closing, for a 40 cent profit, but more likely adds since it appears to be a buyer. Will check the open interest tomorrow.)

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume

Amylin Pharmaceuticals (AMLN) is down 39 cents to $17.59 and recent trades include a buyer of 5000 Mar 22.5 calls at 45 cents each. More than 8,000 now traded. Implied volatility is up about 8 pecent, to 75 percent. The company reported earnings last week. Citigroup analysts upgraded the stock to Buy and raised their target to $27 from $14 ahead of the earnings. The firm said they’re optimistic of FDA approval of LAR and this considerably increases Amylin’s value. (Looks like today’s drop fills the gap on the chart from when Citi made their comments.)

Shares of Cliff Natural Resources, which have declined some 20 percent in the past two weeks, are getting a 5% bounce today up $2.52 to $42.47 a share. But someone might be getting religion a little late and wanting some protection in case another 30 percent drop is in the cards, as a block of 3,000 of the July $30 puts was purchased at the $1.90 asking price. Shares of CLF are still up some 150% from March lows.