hey hey there, we're live at the nasdaq market site. who's this guy? guy and the rest of the gang are getting ready. check out what's coming up. >> lucky charms. >> perhaps delicious for your portfolio, we'll tell you what it's about, soup and cereal stocks that has some traders salivating. have you lost money in twitter? >> it's not even a question i'm considering. >> well, jack, other investors feel differently. we've got a way to get your money back and it won't cost you a dime. and -- >> i stop when my gold -- >> it's been on a tear this

week. why the run may have just started. the action begins right now. it was a story of the week, crude and energy stocks surging. how long can the rally last? is it too late to get in on the big oil names. what did you make of this big move we saw? >> there was certainly so much bear sentiment. it's interesting if you look at oil fundamentally we still do have an over abundance of it. and both the iea and and eia are suggesting it will last until mid 2016, a million barrels of excess production. in the scheme of 95 million barrels a day, is that a huge amount? it is when you're running out of storage. that's the big issue and that pressure will remain. i don't know there's a lot more legs to this. >> we saw pretty big moves, exxon was up 4%. >> exxon is up 10% and you saw

the large integrated thing we're consolidating over the last month or so. a lot of people are starting to say, what are the worst case scenarios here. exxon is a stock back in 2009 saw earns decrease by half, down 50% in 2009 for the prior year then saw a big pickup. consensus is calling for the same sort of drop this year but not a huge increase next year. people are saying these stocks could be cheap, if there was ever a reason for demand to go up, to me, i don't think we got any data suggesting that. to mike's point, it was kind of technical. >> hi -- >> it's cool to hang out with you. >> it's weird to look on this side. >> i'll hang out and talk away. >> my third oa appearance. now i'm an "oa" cast member. today the dividend is 5.5%. they are going to report on october 29th. is the oil patch fixed?

i say no. it's still a demand story. we're going to find out. the data we've seen from europe and china and the united states has been awful in a word. if you think deflation is a fear, a factor which i absolutely believe, then i think there's another leg to the downside. >> those big dividends and low yield environments should be a big warning sign. options markets have indicated that they expect that the dividends would be cut in a lot of integrate d names. >> even the ones where they have said they have never cut their dividend in x number of years? >> never say never. we're not just the options market but stock market telling you this, 6% or close to it, it's not realistic. >> dan? >> exxon never cut their dividends. >> a decrease -- >> we talked about that. i think we have a five-year chart of exxon here. the thing topped out last year 105. it is a massive down trend.

it just rallied back to that down trend and i think you have a good opportunity in the near term for a trade on the short side. they have earnings coming out. in a week or two. i looked out to november expiration today when the stock was 79.5 and bought the november 77.5 for 1.5 and one in the november $1.90 and sold 70 puts at 40 cents. between 76 and 70 i can make up to $6, four times my money. 70 was a big level. 80 was a really important resistance level also matching the down trend. i'm risking 1.50 to make four times the money if it gets rejected and goes back and tests the low. option prices have come in dramatically over the last few weeks. this is a decent trade set-up into earnings. >> the options prices have come in but they are not become down

-- back down to the lows. options prices while lower are not as low as they should be yet. a put spread is the way to play this. >> what is the right multiple? they probably have -- they trade close to 20 times forward earnings, you have to wonder at what point is it too much. i don't think exxon will cut their dividend. there are other names though are in trouble, mike mentioned conoco phillips, it wouldn't surprise me, we have to cut our dividend. this oil environment did not fix itself in one week. >> the debt levels on the balance sheet continue to rise. if we do at some point see an increase in rates, that's going to increase borrowing cost and becomes very hard, not sustainable to continue to borrow money to pay dividends. >> i would think it almost doesn't matter if another company cuts its dividend. >> we really haven't seen defaults yet or bankruptcies in

the oil field. if we have that soon, that's the thing. one other point about the options trade structure. yes, maybe you don't want to sell that 70 put. if we see the stock more lower, maybe the buy the 77.50 but you'll want to offset some decay. >> earnings kicking into high gear next year. so far it's been a season of pain. all missing and falling hard on the results. which names do options traders see having big news. dom? >> so melissa, we've got earnings season kicking off, this coming week over 30 s&p 500 companies are going to report. you have johnson & johnson, intel on tuesday. wells fargo, netflix on wednesday. thursday, mattel, friday ge. there could be more volatility around the earnings reports, what the options market is telling us. a couple of big tech/media

names, intel and netflix, if you look at the options and what they are implying about a possible move around earnings, they are a bit more volatile than they have been over recent memory. the last few years or so, you look at intel, up 5% plus or minus in terms of the move on and around earnings. with netflix it's even bigger, 15% implied move up or down. that's the media and tech side. take a look at the financials, a lot of them reporting next week, you look at the goldman sachz, wells fargo, implying a smaller than average move in and around earnings. tech and financials, big movers and on the financial side some that may not be quite as volatile as they've been in the past. back over to you guys. >> thank you, dom chu. that's a big move expected out of netflix and especially because this comes after a big

move into earnings. >> we had a lot of big news and why would you normally expect this? you might get a surprise out of it but we had one surprise on the price increase. the other issue, look at the last four quarters, it's been closer than 20% moves for this stock over the last four quarters. this is something that really whips around. i actually expect that maybe when everybody is looking for that huge rip, maybe this time we won't get it. >> well, i would add one point. this q3, if you go back and look at the last four quarters they reported, stock was down 19% last year and 9% the year before that. and 11% the year before that. for some reason there may be seasonality about this q3 and guidance they give for q4. that doesn't exactly make a trend but -- >> for every single one of their last four quarter, 18% before that and 18% the quarter before that. >> i want to get to the trade. >> i'm going to make a bet and it's a low risk bet that they

are not going to move as much as the options market is forecasting this time. i'm looking at the calendar spread specifically, the you pay $9.85 and sell the octobers for $7.10. it cost 2% of the current stock price. we're selling that short dated october and collect that decay then we get to own the november call until november expiration. >> you think it's not going to move as much because it already had moves? >> it's had the moves and even if it does move, you could see a whip side down but if it catches legs after that, you'll get the own the call. >> this is a smart trade and you have to have a view about what's going on with this company and how options are priced. to me based on the history of the company, it's not a great bet to make. you're really trying to pick one needle in a haystack. i think that obviously if they were to miss and guide down and

whatever this pricing information does their forward guidance, the stock is going to get creamed. but it has the potential it has gapped up 18% higher each one. when it has good news, it goes to new highs. >> i think he would be reaching for my neck right now but i think the stock has a chance to rachet higher once again. the only misstep this stock has taken was july in 2011 and it got on liberated. you saw the price increase yesterday. it was subtle, wasn't a sledge hammer over your head like four years ago. i think it goes higher. >> if it moves 20% and you caught that run, you're losing 2% to make a bet that will make money if the stock sits right here. even if it rises or falls you still have the opportunity to profit. i think that's the way you want to play this. >> smarter than me. he's the professor. >> if you had to make a bet on netflix, what would that be? >> listen, i think if you look

at 3/4 it has kept on going. the story is till intact. until they misfire, you probably stick with it. >> send us a tweet, if it's nice, we might answer it later in the show. check out our website, optionsactions.c nbc.com. and we have exclusive trades. here's what's coming up next -- >> i'm going to make him an offer he can't refuse. >> you mean pllike a chance to make your money back in twitter? we'll show you how. plus, that pretty much sums up gold this week. we'll tell you why some traders think the run is just starting. ♪ here at td ameritrade, they work hard. wow, that was random. random? no it's all about understanding patterns like the mail guy at 3:12 every day or

jerry, getting dumped every third tuesday. this happens every third tuesday. we have pattern recognition technology on any chart, plus over 300 customizable studies to help you anticipate potential price movement. there's no way to predict that. for all the confidence you need. td ameritrade. you got this. i'm here at the td ameritrade trader offices.

ahh... steve, other than making me move stuff, what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data

you need in one place that lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim? for all the confidence you need. td ameritrade. you got this. the the news of the hour is trouble is twitter. the troubled social media company is planning companywide layoffs next week. the reporter who broke that story curt wagner joins us now. what is the magnitude of the layoffs? what's that looking like? >> yes, thanks for having me. so next week there are going to be companywide layoffs and we're told it's going to impact pretty much every department within twitter. i don't think this is necessarily a sign that twitter is struggling or this is a bad

thing. people have been saying for a long time that twitter is too big on the engineering front. so i think with jack coming back, jack dorsey coming back as ceo, he wants to trim things down and make it more efficient. >> in terms of the engineering department, isn't it hard to get engineers and here they are laying off engineers? it seems like a strange department to target. >> you would think. as we pointed out in the story, twitter's employees, i want to say roughly half of the employees are engineers. when you look at what's really driving the business for them, it's not engineering, yes is keeping the product up and running, but really if there's any place in the country where there are a lot of computer engineers at silicon valley and twitter has been stock piling them for last couple of years. it got to the point where things were too bloated and there was trouble with who was running which projects and people kind of getting side tracked from the ultimate goal.

i think that's what they felt they needed to do was get rid of people who aren't contributing to the overall goal of the company. >> did you feel though during this interim period, he was obviously very popular. now they are coming in and will cut some heads here. how is the mindset amongst existing employees and do they buy into his new found focus. do you think they lost good people over the time period over the last five months? >> i think they have lost some good people. and i think they've already had trouble bringing on good people over the last five months. people were hesitant to join twitter when the ceo decision was still in flux. i think they have some -- they are going to be probably after they get rid of folks next week, they are probably will have to start hiring again and bring out higher quality talent in that regard. i do think that people believe that jack is making this decision for the good of the company. i'm sure that those who are asked to leave won't necessarily walk away feeling their team

under jack dorsey was well spent. but i think people do think and have thought for some time that twitter is just too big and it had to happen and jack is willing to make that tough decision. >> curt, great to have you with us. thanks a lot for sharing the story with us. curt wagner. we did see as curt was speaking on the phone, twitter stock hitting the afterhour session low, down 3.1%, sitting right there now. >> in the second half of 2012 and 2013, facebook, everybody was calling for zuckerberg's head. they wanted a new ceo. look at the stock. it got its sea legs. it's taken at which titwitter mt it's too valuable to leave it for dead. i've been wrong. i thought it would hold 35 six mods ago, clearly it didn't. but maybe it's starting to get its sea legs and this is a good first step. >> you got a trade on twitter as

well -- >> really, i looked at a trade today when the stock was 31 and it was a combination of using options as an overlay to my long stock position to add potential yield and leverage without actually adding risk to the position. today i want to kind of spec. it out, when the stock was $31, catching the next earning event is likely to be very news worthy. i don't know which way it's going to go. i don't think it's going to rally 20% but it has the potential to move one way or the other. you can do a one by two call spread in november expiration for no premium. you can buy one of the november 35 calls for $1.10 and sell two of the number 38s at 55 cents each. that cost you nothing. that's against 100 shares of stock at current levels at $31. this is how you get your yield or potential leverage. >> this makes a lot of sense because the options premiums

here are exceptionally elevated. they are 60 implied volatility high but they are well above what they have been for the 18 months in the stock leading up to this. we put in a one by two put spread and that is another way to potentially take a look at putting positions on in twitter. that's not necessarily a bearish bet. i like it at 25 bucks. >> you like it at 25. >> does this change your view? >> i think the stock could continue to work here. if you have an overlay against your long stock position, this is a sort of trade that could add 10% yield if the stock is between 35 and 38 on november expiration, up to an additional $3. these are the sorts of trades that make sense there's a lot of uncertain uncertainty. if you get that move and worst case scenario, effectively selling at 41 on november expiration. i like those odds there. >> i would be afraid with the next earnings report you have a kitchen sink quarter with the

new ceo. you wait until earnings and drop the axe. >> i think it's fair to be afraid. i wake up afraid. on this show i'm not afraid at all. i love this. in terms of the stock performance, you might get that kitchen sink but i don't think you'll get it in terms of the stock reaction. i think you've already seen it. >> i happen to think the worst is over in terms of stock price. >> there you have twitter shares reacting to the news down so far. we'll tell you how they are going to turn their shiny profits into more cash right after this. here at td ameritrade, they work hard. wow, that was random. random? no it's all about understanding patterns like the mail guy at 3:12 every day or jerry, getting dumped every third tuesday. this happens every third tuesday. we have pattern recognition technology on any chart, plus over 300 customizable studies to help you anticipate potential price movement.

there's no way to predict that. for all the confidence you need. td ameritrade. you got this. suffering from ringing in their ears, there's no such thing as quiet time. but you can quiet the ringing with lipo-flavonoid, the number-one doctor-recommended brand. relieve the ringing with lipo-flavonoid. suffering from ringing in their ears, there's no such thing as quiet time.

but you can quiet the ringing with lipo-flavonoid, the number-one doctor-recommended brand. relieve the ringing with lipo-flavonoid. what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place that lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim? for all the confidence you need. td ameritrade. you got this. he can not see through doors. his speed, anything but superhuman.

but when it comes to health care options, george found helpful information and resources at aarphealth.com this makes him feel unstoppable. well, almost unstoppable. discover real possibilities at aarphealth.com today and tomorrow take on the world. time time for the upside call. we take a look back at winning calls. last week there was a bullest bet on gold and the mineers. >> this downtrend line daily, move to around 17. we take a shot here. >> what you need to do, use a spread. the 14.5, 17 call spread you can spend 75 cents for that. >> you may already noticed that carter is not on the desk.

instead we have a poor man substitute for carter. but carter did send a postcard in the postcard he writes, hey team, elected to take an early jump on columbus day weekend. remember the old proverb, oh, gold i still prefer thee unto paper, which makes bank credit like a bark of vapor. >> it looks like carter still likes the trade, i guess. >> you don't give up on the bullish bet on gold. we had a very sharp move, it's getting closer to the upside strike. sell this one and roll out and up. >> out and up. also last week dan made a bullish bet on consumer staples. >> implied volatility is low to the other sector etf. i looked out to november and when the stock was 47.45 you

could buy the november 47 call for $1.45. >> consumer staples were up more than 4%. do you stick with the trade? >> i close it out. over the last week you could have thrown a dart at the board and had a stock up 3 or 4%. it was up 4%, the options today when it was $49.45 were $2.75 bid, took a quick -- and moving on. i had a quick trade, moving on. >> look at clorox, new 52-week high. some might say these things are a little expensive for what they are. >> people said that about clorox for quite some time. jim cramer comes on after "oa" tonight. we mentioned the gdx brewing in the gold market.

i think it grinds higher. >> and carter. >> i miss you carter, keep sending cards. >> cramer is cracking code and doing the dirty work on three companies joining the tape. plus a real a check on the commodities rally and the game plan for next week. on top of the hour on "mad." coming up next, your tweets and final call from the options pits. . here at td ameritrade, they work hard. wow, that was random. random? no it's all about understanding patterns like the mail guy at 3:12 every day or jerry, getting dumped every third tuesday. this happens every third tuesday. we have pattern recognition technology on any chart, plus over 300 customizable studies to help you anticipate potential price movement. there's no way to predict that. for all the confidence you need. td ameritrade. you got this.

ahh... steve, other than making me move stuff, ces.

what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place that lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim? for all the confidence you need. td ameritrade. you got this. time for the final call. >> it's an honor to sit in carter's chair and to back up what mike and carter said about gold. gdx is going higher. >> i like gdx but the overwrite on twitter shares if you own them. >> i'm looking out to next week, a lot of earnings, intel will be interesting, it rallied 7% this month, left for dead last month. to me i think you may see money come out oit.

and the good news may be in the stock if there is good news. >> guy, a pleasure having you here. >> unbelievable. our time has expired. for more, check out optio optionsactions.cnbc.com. >> announcer: the following is a paid presentation for the fat-burning fusion of pilates and yoga called piyo, brought to you by beachbody. >> hey, everybody, i'm maria menounos, and i'm about to reveal the latest breakthrough in fitness that won't kill your joints. it's an all-new way you can get that long, lean yoga and pilates body you've always wanted without having to stand still and meditate for hours or do microscopic mini moves. don't believe it? well, keep watching and you will. >> announcer: now there's a breakthrough new way you can completely transform your body without weights or high-impact moves, and the results are incredible. >> you see those results so quickly. yoe