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By David Russell

Vimpel Communications (VIP) is attempting to rally after a steady decline, but some investors have other ideas.

OVIP Chart

optionMONSTER's tracking systems detected heavy call selling on the Russian telecom. Most of the activity focused on the 17.50 line, which were active in the June, July, and October expirations. While some of the transactions came against open interest, the two most active contracts--the June 15 and the June 17.50 calls--saw new short positions opened.

OVIP rose nearly 8 percent to $15.85 yesterday following an 8 percent rally on Monday. The rebound comes after a five-week period during which the stock lost more than one quarter of its value. The shares recently changed their structure after an exchange offer produced another entity of the same name with the ticker VIP.

While the broader emerging-market asset class has been falling since mid-April, OVIP has been making lower highs and lower lows since it peaked above $22 in November.

Yesterday's call sellers apparently believe that the shares are running out of steam after two positive sessions. Some traders may interpret the sharp countertrend move as a bear-market rally that will be followed by further downside.

OVIP calls outnumbered puts by more than 4 to 1, but selling dominated the activity. Overall options volume in the name was 13 times greater than average.

(Chart courtesy of tradeMONSTER)

Source: Sellers Targeting Vimpel After Rally