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By David Russell

Boise (BZ) ripped to a two-year high yesterday and encountered an onslaught of call sellers.

BZ Chart

optionMONSTER's tracking systems detected the sale of more than 10,000 September 7.50 calls, most of which priced for $0.60 to $0.70. Volume was more than twice open interest in the strike.

BZ rose 2.94 percent to $7.01 and is up 33 percent in the last month. The debt-laden paper maker has been rallying since it successfully issued $300 million of bonds to term out a bank loan. It also reported a profit on Feb. 25 versus a loss the previous year and said prices had started to rebound in late 2009 and early 2010.

Yesterday's call selling occurred as the stock pushed toward $7.17, its highest price since March 2008. The option activity reflects an expectation the shares will remain below $7.50 through expiration.

BZ has climbed more than 1,000 percent in the last year, matching a pattern seen in many other leveraged companies such as Dana Holding (DAN) and Ford Motor (F), which traded at distressed levels at the depths of the credit crunch.

Overall options volume in BZ was 22 times greater than average yesterday.

(Chart courtesy of tradeMONSTER)

Source: Traders Believe Boise Has Hit a Top