Trade of the Week: Unusual Options Activity in Amazon

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Recently, there has been unusual options activity in Amazon (AMZN). The online retail
giant has seen a record amount of business this holiday season. While it could be simply a
matter of fewer people wanting to fight the holiday crowds, it also is a sign that consumer
spending in the US has remained strong. After the price of AMZN stock has climbed in
recent days, a trader purchased a put spread expiring in January. The trade makes money
if the share price drops prior to January 17th expiration. This position could be a hedge
against a long stock position, or it could be a bet that the stock price has peaked and could
be headed back down.