Nio's Stock Has Option Traders Gearing Up For Higher Move

Nio Inc-ADR NIO 1.94% unveiled its ET7 smart electric vehicle model with its official interior, as well as the company's new Power North Plan, at the19th Shanghai International Automobile Industry Exhibitiontoday. The event will run through to April 28.

Option traders were expecting a return of positive sentiment into the stock following the reveal of Nio’s new products, and they bet more than $852,243 the share price of Nio is going higher.

The Nio Trades: At 9:46 a.m., Monday a trader executed a call sweep, near the ask, of 419 Nio options with a $40 strike price expiring on Oct. 15. The trade represented a $251,400 bullish bet for which the trader paid $6 per option contract.

At 9:46 a.m., a trader executed a call sweep, near the ask, of 1,096 Nio options with a $37 strike price expiring on April 23. The trade represented a $134,808 bullish bet for which the trader paid $1.23 per option contract.

At 9:56 a.m., a trader executed a call sweep, near the ask, of 1,445 Nio options with a $40 strike price expiring on April 23. The trade represented a $69,360 bullish bet for which the trader paid 48 cents per option contract.

At 10:19 a.m., a trader executed a call sweep, near the ask, of 485 Nio options with a $34 strike price expiring on April 30. The trade represented a $174,600 bullish bet for which the trader paid $3.60 per option contract.

At 10:52 a.m., a trader executed a call sweep, near the ask, of 705 Nio options with a $36 strike price expiring on May 21. The trade represented a $222,075 bullish bet for which the trader paid $3.15 per option contract.

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 option instead of placing a bid, which sweeps the order book of multiple exchanges to fill the order immediately.

These types of call 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.

NIO Price Action: Shares of Nio were trading up 1.91% to $36.78 as of Monday afternoon.