money, then things. now you stay safe. bye-bye. ♪ this is "options action." tonight -- ♪ ♪ perhaps you should, because solar stocks are showing signs of a big comeback and we'll tell you why. plus, consciously uncoupling. we're talking about how amazon is breaking up with retailers and how that could spell trouble for the online giant. and leaving las vegas.

investors are betting against sin city. "options action" starts right now. happy friday, everybody. here are the traders in times square and los angeles. we'll get to them in just a second. before all of that, we're going to start with apple, because reports of a new larger iphone coming in september have apple's fans and investors all in a advertisy. -- tizzy. john ford has been working his sources on the phone. john, do you think a september release is in the cards? >> mandi, i do think september release is reasonable. that's the cadence we have seen apple on lately and considering that carriers aren't keen to let users upgrade early, introducing a phone much earlier than that,

wouldn't get a big marketing pop that apple likes to look for, as far as the size of the phone, a bigger phone seems likely based on so much the potential -- the component leaks that we have seen out of asia, that's where we tend to get the best signals of this, but this latest report about two bigger phones, there are some things in this that make me and some others a little skeptical particularly the idea that the display resolution would be significantly higher than that of current mod else. -- models. if you got a bigger phone, of course it has more pixels. but adding more density in the pixels, apple doesn't seen as necessary. there are some things in these latest reports that don't sound quite right. >> and the other thing i'd be worried about is whether or not a larger sized iphone might

cannibalize ipad mini sales. >> if you're going to cannibalize anything, with an iphone, that would be a good thing as long as they sell a lot of them either way. >> apple has been pretty stubborn about making these changes, if it goes to larger phone, what does it say about apple and samsung? did samsung win? >> you could certainly interpret it that way because they did champion the big-phone movement. but apple has walked back some of the things that steve jobs said about smaller tablets. we have an ipad mini now. he's been walking back on comments about the quality they snz would need in order to do that. of course, they're working on sapphire glass as well. all sort of advancements and components. if they could point sand eye i

could there it could too this willin willing. >> we've already alluded to the fact that apple has stob only club to the idea that a smaller hand set -- i bought a larger droid because i wanted the larger screen. that said, i don't think that an iphone six is going to take that back to top line self growth what it would earn its earnings when you take about 140 million.

but it's no longer a growth stock. >> jon fortt, thank you. what does it mean for apple shareholders. mike, do you see this as a game-champk? >> i don't know if it's game-changer, it's certainly necessary, we already alluded to the fact that apple clung to the idea that their smaller handset was the way to go. i used to own an iphone, i bought a larger android phone. this is a very, very cheap stock. that said, i don't think an iphone 6 is going to take this thing back to double-digit revenue growth. this thing is trading probably

8.5-times its earnings when you take out the cash. so, the stock is absolutely cheap. but it's no longer a growth stock, so don't expect that. microsoft has proven that you can keep these low multiples for a long time if you lose the growth that you once had. >> what is the trade on apple? >> you need to think about it in a different way. because in general, i want to own technology, i have been doing all year. one thing you have to take a look at, the market feels a little frothy. this is some exciting news for apple. to go along with thigh kro soft -- microsoft 360 going on to the iphone, i think that will help sales as well. you have to define your risk here by being long in the market. volatility is sort of rising. when you play it, you play with long calls or you get some sort of protection, roll out your stock position. >> what do you think, scott? >> i think that's absolutely right. the option volume today on apple today, wasn't impressive. so, i think mike is absolutely right when he says this isn't a growth stock anymore. >> what about the numbers? >> when you're taking a look at this as far as the stock replacement. i'm going to go to risk less to make more. basically, taking a look at two weeks out, the weekly april calls, by selling for 2.20. finance a purchase of a longer data call. so, i buy the may call for about 11.20. when you net that out, that's $9

for this trade. i have reduced a little bit of risk here, here's the factor, i don't want to see apple rally above 5.50 over the next couple of weeks. when that april call comes off the board and expires, i have all of the upside from there on out. this is a perfect scenario for me to continue to get upside exposure. >> mike? >> i have to say i'm perplexed here. we're talking about an iphone 6 release, it's not going to happen in april or may, but april is the option that he's looking to buy. i love calendar spread. but i think in this case, i mean, when you take a look at the potential catalyst for april, you have to look at pushing further out, you know, scott, sometimes refers to the fact they become super calendars. >> okay, let's move away from apple and take a look at solar stocks that suffered a very, very difficult week. sheila at cnbc hg breaks it down. >> investors didn't take a shine to solar stocks this week, they lost about 6% just on the week alone, sunpower down 3%. some better news did came today raymond james upgraded solar

city. in fact, in sunpower a whopping nine calls traded for every put. solar city. option traders clearly feeling the selling might be over, mandy, perhaps seeing a little bit sun year. i couldn't resist. >> thank you, sheila okay, now a good time to get into solar stocks? let's check in with carter. carter, what do you think? >> i have two charts. one without the 150. one with. without, let's start there, you have a six-week selloff from 55 to 35. down 35%. you have a six-week selloff from 65 to 42. down 35%.

again, we have it here, 87% to 57%, down 35%. it's exactly the same by our work as the other two times, take advantage of the weakness, take advantage of the weakness, take advantage of this weakness. here's the chart about the 150-day moving average. we're off the 150 day. off the 150 day. a great time to buy the stock. we like it a lot. >> great time to buy the stock. you said it, carter. what's the verdict from you, mike, on this? what's your trade? >> one of the things we often try to take the technical view and then the fundamental view. this is trying to imagine what might happen. the multiples here on these things ares a tron call. -- astronomical.

elon mufk is asking us to imagine an electric car in every garage. >> chantel: if i 50/-- and solar windows. of course, that hope means the stock is exceptionally volatile and when stocks are volatile options are experience. the way you can pay this by selling the puts spread. you collect that money if the stock stays here or rallies higher. >> do you like this trade, brian, that mike just laid out? >> i do. because i think he's selling into some of these weakness that carter talked about. to go to that point here, the fear in the options market now, we see traders panicking, we're seeing traders sell out their insurance.

selling out those puts, collecting some premiums, if it stays above that price point and that price target, he gets to collect that premium and it's a winner for him. take the opposite side of the stock and sell to the bullish side. >> the stock moved up 1% as well. scott. >> the valuation is very high, that the volatility is very high. options are very expensive. anywhere between 4 and 7 times times more than supo and bottom in 3/

mike is absolutely right. to have an opinion about direction and to express it by selling options, selling spreads, he's defining his risk. >> bottom line, mike. >> sometimes we like to sell naked puts, you don't want to catch betting the wrong way on this. [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪

[ bell ringing, applause ] five tech stocks with more than a 10%... change in after-market trading. ♪ all the tech stocks with a market cap... of at least 50 billion... are up on the day. 12 low-volume stocks... breaking into 52-week highs. six upcoming earnings plays... that recently gapped up. [ male announcer ] now the world is your trading floor. get real-time market scanning wherever you are with the mobile trader app. from td ameritrade.

got a question, send us a tweet. we'll answer it in our web extra on our website. tonight, scott is going to be taking a look at silver. in the meantime here's what's coming up next -- >> wow, winning.

that's how you perceive it. >> it not the casino stocks, they're on a losing streak and why it could get a whole lot worse. ♪breaking up is hard to do >> indeed it is. exactly what amazon and retail stocks are doing, what does it mean for the future of the online giant? welcome back to "options action," everybody. some breaking news now on general motors, let's get back to hq. >> breaking news from gm the company is expanding the recall associated with those ignition switches. the number we have 824,000 models sold in the u.s. from 2008 to 2011 will get a new ignition switch. in the statement, we have the company saying, because it's no

to feasible to track down all of the parts, the company is recalling 824,000 more vehicles in the u.s. to ensure that every car has a current ignition switch, yet, another step of bad news for the company. >> sheila, thank you very much for that breaking news. mike, what do you do with gm. >> this stock is incredibly cheap. over $28 billion in cash, trading at a single-digit multiple. it's not going to be consequential to their earnings overall. always room for improvement, certainly the case when it comes to mike and carter's trade on win. this is what happened. the question is how will they fix their trade? >> the price was a horrible trajectory. against us quite a bit and now it's back to where we started. >> we'll stay short.

there was an opportunity to spread it right after we put it on. if you get another opportunity like that, that's what you're going to want to do. ♪ ♪ ♪ [ tires screech ] chewley's finds itself in a sticky situation today after recalling its new gum. [ male announcer ] stick it to the market before you get stuck. get the most extensive charting wherever you are with the mobile trader app from td ameritrade. [ indistinct shouting ]

♪ [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪

>> amazon, a big market, but it not acting like it. it's far and away the worst performer.

amazon a big retailer, is not acting well compared to the market and compared to other parts of retailing, but here's a comparative chart year to date, what i wanted to point out, amazon far and way the worst performer, in turn a part of the internet retailing industry group and that's part of all of retailers which is a part of consumers discretion which is part of the s&p, lot of correlation here. we have amazon is worst any other way you want to compare it. market the group and so forth. that's a problem, it's also a problem if your chart doesn't look good. if you want to draw the lines this way -- i think i lost my pen here -- here we go, great. we got a shoulder, a head, shoulder head. very well-defined neckline. these gaps are what are in play. take a look at the longer term picture, it bounces off its trend line quite well and quite precisely. the presumption is, at a minimum, we're going to head back towards that trend line that's 300. or 10% or 12% lower. a little longer term, this strength of the past year and a half, we blew through the top of a channel that has been in effect since 2007 and now, to get to 300 will take us to the exact midpoint of the channel, we think that's a reasonable price objective. finally, the really long term chart, this picks up your tops in 2000. what's relevant is how

but what is relevant is how well-defined a channel it's been descending. here's the top, we blew through the top. presumption is we're coming back toward the middle. sell amazon. >> are you worried about amazon as well, scott? >> not only is the chart ugly but the valuation is no treat, either, the company is finally making money the p.e. is well over 500. i don't think there's anything good going on over at amazon. the interesting thing for the trader is, carter has a downside target. given that we're bearish a downside target, we want to buy a puts spread. earlier in the day, amazon, you can buy the june 300. 335 put spread. for $11.75. with any put spread we buy, that 11.75, that's our max risk. but where do we make money? as long as amazon is at or below carter's price target then we make $23.25.

we're only risking 11.75. it may well more than double that because we're biography the at the money put. >> you know, there's only one thing really that you can do with amazon is that is to use options to make a bearish bet, people have been screaming that this thing was overvalued. since it was less than $200 and even before that. this stock or naked sell up side. but this put spread actually has fairly nice numbers to it. you're going to make a bearish bet, enough time out to the june expiration. >> no trader wants their face ripped off. what do you think about it, brian? >> another thing, we talked about solar city, it looks like they're slowly adding insurance to their position. there's some pent-up nerves

about that here. it makes sense to buy a put spread. >> that's how risk less to make more. coming up next, the final calls from the options pits. [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪

[ bell ringing, applause ] five tech stocks with more than a 10%... change in after-market trading. ♪ all the tech stocks with a market cap... of at least 50 billion... are up on the day. 12 low-volume stocks... breaking into 52-week highs. six upcoming earnings plays... that recently gapped up. [ male announcer ] now the world is your trading floor. get real-time market scanning wherever you are

with the mobile trader app. from td ameritrade. all tonight on american now. >> don't you dare miss it. >> oh, that was great moment between larry kudlow and jim cramer. today you can catch larry's last show at 7:00 p.m., he's moving on to a senior contributor role at cnbc. we'd like to take this opportunity to salute larry for service for many, many years. make sure you tune in later on tonight. a very special show. but, now, back to "options action." time for the last final call. the last word from the options pits.

>> mike, larry kudlow we're going to miss you but i like what carter is doing on amazon. technically, fundamentally, it's a good structure and you don't get your face ripped off. >> brian? >> still like my apple play, i think it's a good growth tech name that seems to have relative strength right now. >> carter? >> weakness in amazon, something to stay away from. weakness in solar city something to take advantage off. >> thank you for joining us. our time has expired as well. for "options action" go to our website. have a great weekend.

paid presentation for derm exclusive instant anti-aging, brought to you by beachbody. [ cheers and applause ] >> wow. hi, everybody, and welcome. i'm deborah norville -- journalist, author, wife, and mom -- and today i am joined by grammy-winning music superstar chilli of tlc. woo-hoo! [ cheers and applause ] and television phenomenon turned entertainment reporter mindy burbano stearns. [ cheers and applause ]