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Diving deeper into the recent options activity on SMH, “the August 90 and 100 puts saw the biggest increase in open interest over the past 10 days, and it looks like these back-month options were possibly used to initiate a long put spread back on Friday, June 15. If this was the case, the trader expects the exchange-traded fund to keep falling through August options expiration, but lowered their risk — and set a floor — by selling the 90-strike put,” according to Schaeffer’s.
SMH currently resides around the $103-$104 area and has not closed below $90 in almost 10 months.
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