Carnival Docks In Dominican, Options Traders See High Tides On The Horizon

Carnival Corp’s CCL newest flagship, Mardi Gras, reached port in Amber Cove, Dominican Republic on Wednesday. The ship is the first in the Americas to be powered by eco-friendly Liquified Natural Gas.

Mardi Gras boasts 19 decks with six distinct themed zones, more than two dozen restaurants and also features the first roller-coaster ride at sea, called BOLT. The cruise line plans to deploy 88 ships after the pandemic when it fully resumes its services.

The rapid and increasing spread of the COVID-19 Delta variant has weighed heavily on re-opening stocks such as cruise lines and airlines recently. Between June 8 and July 19, Carnival’s stock declined almost 40% before rebounding slightly. On Wednesday, increased selling pressure had Carnival trading down about 1.68% from Tuesday’s close.

Bullish options traders may see continued near-term pressure but further out on the horizon see upside for Carnival’s stock. A number of traders purchased $1.28 million worth of bullish Carnival call contracts. Each trader chose an expiry date with a monthly expiry in either September, November or January 2022.

See Also: How to Buy Carnival Stock

Why It’s Important: When a sweep order occurs, it indicates the trader wanted to get into a position quickly and is anticipating an imminent large move in stock price. A sweeper pays market price for the call or put option instead of placing a bid, which sweeps the order book of multiple exchanges to fill the order immediately.

These types of option orders are usually made by institutions, and retail investors can find watching for sweepers useful because it indicates “smart money” has entered into a position.

The AMC Trades: Below is a look at the notable options alerts, courtesy of Benzinga Pro:

• At 9:32 a.m., a trader executed a call sweep near the midpoint of 270 Carnival options with a strike price of $22.50 expiring on Jan. 21, 2022. The trade represented a $74,250 bullish bet for which the trader paid $2.75 per option contract.
• At 9:38 a.m., a trader executed a call sweep near the midpoint of 959 Carnival options with a strike price of $22.50 expiring on Nov. 19. The trade represented a $210,980 bullish bet for which the trader paid $2.20 per option contract.
• At 10:28 a.m., a trader executed a call sweep near the midpoint of 357 Carnival options with a strike price of $22.50 expiring on Nov. 19. The trade represented a $76,398 bullish bet for which the trader paid $2.14 per option contract.
• At 10:28 a.m., a trader executed a call sweep near the midpoint of 642 Carnival options with a strike price of $22.50 expiring on Nov. 19. The trade represented a $137,388 bullish bet for which the trader paid $2.14 per option contract.
• At 11:30 a.m., a trader executed a call sweep near the midpoint of 373 Carnival options with a strike price of $22.50 expiring on Sept. 17. The trade represented a $52,966 bullish bet for which the trader paid $1.42 per option contract.
• At 11:46 a.m., a trader executed a call sweep near the midpoint of 1000 Carnival options with a strike price of $15 expiring on Jan. 21, 2022. The trade represented a $735,000 bullish bet for which the trader paid $7.35 per option contract.

CCL Price Action: Shares of Carnival were trading down 1.9% to $21.01 at publication time.