I had mentioned in my recent blog that Under Armour (UA) has established a bottom. Since then, it has been steadily trading up on heavy volume. It still needs to resolve the downside gap which still remains and is beginning to be filled on the way up and will completely fill at $48.88. UA is the beneficiary of cautious outlook on their previous earnings. Since then, the stock has taken it on the chin but I think the selling has been over done. Recent fears of retail slow down has affected this stock and growth concerns also have played a key role in the down turn. Likely so, the stock now sports a 36% short position but I assume some of those positions are unwinding right now for reasons unknown. I believe the options are relatively cheap at this point and I have established July $50 call option at average price of $1.65 for a total of 150 contracts.
Lets consider the chart here:
If the gap gets completely filled, we could expect to see a challenge of the $52 level in short order. This is an amazing highly liquid market which is driven by demand. I don't know what is fueling it and I don't care to speculate. All I would like to say is that this one has definitely gotten some big money's attention and is headed up.
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