Shares in Lumber Liquidators continue to rebound and last traded higher by 11.2% at $36.40 following the company’s investor call on Thursday. Implied volatility on its options has fallen by 12.1% to 87.7% having reached 127% as a result of the recent scandal.
It seems that many onlookers feel comfortable that the accentuated weakness in the price of crude oil may have ended. But one option trader appears to be positioning for prices not to budge much over the next couple of years.
Yesterday marked the third session following Friday’s employment report big sell-off. The decline in the Eurodollar March 2016 contract was a 2.7 std dev move, the likes of which had not been seen since January of 2011. There was no meaningful recovery over the three sessions following that decline.