mike khouw has a strategy to capitalize on the sinking feeling. risk less and make more. "options action" starts now. >>> we kick things off tonight with a headline that rocked wall street the journal reporting the largest hedge fund fed more of a billion dollars. ray dalio founder of bridgewater associates says that's not the case dalio fired back saying to convey us as having a bearish view of the stock would be misleading the whole back and forth is thinking if you're betting on the pull back, what's the best way to play it right now. dan has some ideas let's get in the money, dan. >> it depends on time horizon. whether it's true or not, bridgewater is engaged in trading all the time around a lot of their positions hedging, directional, who knows what the heck it is. when you think about a headline like that that a lot of traders and investors were talking about, it gets me thinking about let's look at the pricing of options a little bit with the stock market teetering at all-time highs, it's up 19% we have a little more than 1 month left in the year there's a chart of

khouw has a five-star uber rating. but how will he rate uber stock heading into next week's earnings buckle up, because it's time to risk less and make more. "options action" begins right now. >>> and let's get right it earnings season in full force. but will the force be with disney when it reports next week the media giant trailing the broader market this year but dan says the stock could conjure up magic when it releases earnings on thursday. let's get in the money dan take it away. >> back in july the stock was massively outperforming the market it had a lot of momentum we had a five-year chart. starting with this this thing was range bound, finding a lot of resistance for years at the 120 level and broke out in april when they gave some color about this disney plus service, the streaming service that they are rolling out in just a couple of weeks. and so that chart is really interesting to me. you see that island, that it spent in the last six or so months trading above 130 kind of interesting setup when you think

. >> if you are worried about the tech giant results next week, mike khouw has a place to run. it's time to risk less and make more "options action" starts now. >>> before we dive into the show we've got breaking news on boeing and american airlines let's get to phil lebeau with more phil. >> and melissa a new date when american airlines will be returning the 737 max. remember it was january 16th they have now pushed it all the way back to march 5th. coming a come hours after southwest says it's pushing bab the return of the max to march 7th. once again airlines delaying when they expect to fly the plane again. >> phil, thank you phil lebeau with the latest on american airlines. >>> well the markets may be sitting at record highs one sector showing weakness. look at the xly consumer discretionary etf. lagging behind the broad are the market and more than half of the stocks in the seccer now sitting in correction territory our chart master cart are worth says there could be more trouble ahead. why don't you head over to the plasma, break it down. >> it's an instance of well, not

mike khouw has the strategy to capitalize on that sipgsing feeling. it's time to risk less and make more "options action"s starts now >> we kick things off with the head line that rocked wall street the hedge fund that just had a million dollar pull back the whole back and forth got us thinking if you're betting on a pull back, what is the best way to play it right now? dan has got some ideas >> it really depends on time horizon. i'm sure bridgewater is involved in lots of trade options all the time it could be hedging, directional, who knows what the heck it is the when you think about a head line like that, a lot of traders and investors were talking about, it gets me thinking about, let's look at the prices of options right now u with the stock market teetering at all-time highs we have a little more than one month left in the year there's a chart of implied volatility in the spy, the you s see that it's trading near one-year lows. i think viewers will understand that those spikes correspond with declines in the s&p and values of the index. i don't

but if you're worried the recent run is about to roll over our mike khouw lays out his volatility protection playbook plus calling all "options action" fans reach into your pocket, grab your phone and tweet us your question at "options action. if it's nice, we'll answer it on air, when "options action" returns. ♪ >> announcer: "options action" is sponsored by think or swim by td ameritrade. ♪ ♪ ♪ ♪ it's got all my favorite shows turn oright there.boom, i wish my trading platform worked like that. well have you tried thinkorswim? this is totally customizable, so you focus only on what you want. okay, it's got screeners and watchlists. and you can even see how your predictions might affect the value of the stocks you're interested in. now this is what i'm talking about. yeah, it'll free up more time for your... uh, true crime shows? british baking competitions. hm. didn't peg you for a crumpet guy. focus on what matters to you with thinkorswim. ♪ >>> welcome back to "options action." check out the bright shiny all all-time highs across the indices. beware, our chart master says the

mike khouw in san francisco with the action hey, mike. >> square did see about two times the average daily options volume when i looked at this earlier today. implying a move about 8. % one way or the other by the end of the we can. well above 6.35% averaging the last eight quarters but probably makes sense given the if a accurate that last quarter we saw a big decline in the stock much large rn than implied by the options market right now the sentiment overall was fairly mixed one of the tradeswork, the largest trade actually i was looking a was the weekly 63, of 6 call spread, somebody spent about 96 cents for that a thousand times that's a bullish bet making through the 63 strike price by at least the dollar they paid break around 64 level maybe looking to the 66 level or slightly above at least one trader is making a bullish bet into urngs earnings but making risking little. >> what do you make of it karen. >> i think i did it at 139 maybe sold it at 16. clearly missed the ride. i like the company tp there are interesting things going op. square capital, square cash is interestin

mike khouw in san francisco with the action >> calls outpaced puts by 2 to 1 on double the average daily options volume representing about 120,000 contracts total trading in the options implying a move of 3.7% on earnings that may seem modest given the moves in other stocks. but it's worth noting this is a stock mochgt less than 1.5% on the last eight quarters. where we saw motivate october was the november 22nd weekly 135 strike calls that's capturing both of the upcoming events. between 10 and 10:30 and nearly 13,000 traded all day buyers of the calls bet the calls with rallying through the $2 strike price they paid. they may be targeting the all-time highs they saw in august, a little more than 10% higher than now. when we look at some of the things guy was talking about, disney, like many other stocks is trading close to if not at the peak valuation on a variety of metrics it would make sense to use inexpensive call options to press the bullish bets here i think. >> the bar is high in other words going into this earnings release. what's the number one thing that need to hear tomorrow

but as retail's biggest season comes in focus options trader bet it there will not thrive mike klohe in the khouw's nest in san francisco. >> on what would otherwise be a fairly late volume option trading day, xrt saw three times average daily put vom. puts outpacing calls by more than 20 to 1 today because obviously the other options weren't trading heavily. and the most actively opened options were the january 43 puts over 7,000 bought for just over is 60 cents. and buyers of the putting ob lv bet the xrt falls below the strike price by the premium spent. representing a 6% decline to the break-even point between now and january expiration but i would point out that this trader already had a bearish trade on they were pushing out a bearish bet they had hon the december 43 strike out to january on the 43s and 44s. maybe they are seeing obeyish things ahead but think going might take longer to see it happen. >> you don't like retail do you. >> we were talk about xrt and only up 10%. the big box guys are doing heavy lifting. home depot, lowes. everything else not trading weapon this is

pike khouw in san francisco with the action hey, mike. >> the options market right now is implying a move of about 3.7% in tesla shares between now and the close the day after tomorrow that's a wider range actually than the stock has seen over the last five trading days the most active options were the weekly 360 calls over 10,500 of those traded those for average price of knife dollars buyer of calls betting the stock rises above the 360 viek price by the $5 they paid push going into territory it hasn't seen since december of 2018 when we think about what could proposal the shares higher or lower. light duty truck sales seem like the area that's the most profitable sector for the u.s. auto industry. >> did anybody see the new porsche ev the one that phil was stenograph in front of beautiful car. >> it's been a threat a long time phil has brought it up many times. >> now on sale next year. >> how much will that. >> that i don't know. >> model s competitor. >> potentially. >> what did you think of the car. >> i'm a former porsche owner. the taikan they were trying to fine find a hybri