Market Insights

Intel is surging on signs of a product breakthrough, and options traders are piling in.

Unusual activity was detected yesterday in the once-dominant chipmaker. These were some of the most active contracts:

• More than 54,000 13-June 22 calls traded, with the initial blocks pricing for $0.05. Premiums surged as high as $0.80, but most of the large transactions crossed the tape for about $0.30. Volume was more than 48 times open interest at the strike, a sign of new money being put to work.
• Some 32,000 13-June 22.50 calls changed hands from $0.02 to $0.57.
• About 27,000 13-June 21 calls traded for $0.13 to $1.55, but most of the big blocks priced for $0.29 to $0.33.

Calls fix the level where investors can purchase a security. They can gain value rapidly when a stock appreciates, but also expire worthless if it doesn’t move quickly enough.

Tuesday’s activity followed reports that the performance of INTC’s Raptor Lake chips improved by 14 percent in a recent test. That suggested the 56-year old company could regain ground in the PC market lost to Advanced Micro Devices (AMD). The news comes less than three months after Lip-Bu Tan was hired as INTC’s new CEO.

Intel (INTC), daily chart, with select patterns and indicators.

INTC was the biggest gainer in the S&P 500 yesterday, climbing 7.8 percent to $22.08. However, it’s lost about two-thirds of its value in the last five years as management struggled to produce thinner processors. It’s also lagged in the AI race.

The stock has clung to a price range from early last decade but is now trying to push above its 50- and 200-day moving averages. That could make some traders hope for a rebound.

Overall option volume in the stock was more than 3 times greater than average on Tue, according to TradeStation data. Calls accounted for a bullish 78 percent of the total.

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