>> who were you expecting? we are live at the nasdaq markets. the greiss getting ready behind me. while they're doing that. this is what's coming up on "options action." yeah. that sums up apple this week. but if you own the stock, we'll tell you how you can get your money back with a simple trade. plus, wal-mart, always low prices. >> that certainly was the indicate today. they could be serving up a big warning to the world. we'll explain and -- >> i love gold. >> you are not alone, buddy. but the man that called the

bouillon breakout says there is a better way to play, the action begins right now. >> ok, let's get to it. because it was the one stop captivating main street and wall street today and it wasn't apple. it was wal-mart falling hard today on very little news is the tumble today a broader warning for the economy and the market? let's get in the money and find out. what do you say? >> i think there was a lot going on, stock was down 3%. it was the largest one-day decline when the company disappointed. a disappointed q4 and guided down for the full fiscal year. when i think wal-mart has a steady incline, up 9% of the year, trading about the market multiple and that doesn't seem right when you consider it was the firstier they had an annual

sales decline since 1990. obviously, amazon's results speak to me about the share. wal-mart up % a year makes me nervous. i think it can change that 25% mood. >> and 25% off the low a. big asset moving that much. so, obviously, has you back risk. i am sure you are looking at certain levels. today's action is bad after a big move like that, presumptively more to go. >> one of the things you definitely should look at when you look at a company like this and you look at valuation. it's not a growth story. it's a secular decline story him we know the migration of retail is going online. we know they have been facing historically a lot of wage pressures. we are continuing to hear more about. that they have a lot of things that will continued to prash them. don't expect to see top line growth. will you see instead pressure on their marginsch that's not a reason to buy at a current market multiple. >> since february 18th, the ceo

talked about lower oil being a possible tail wind for them. when you think about who their consumer is. since then, crude oil rallied 15% him gasoline rallied 18% some that tail wind he was hoping for may not be. obviously, 25% of sales come from overseas t. dollar hit that profitability. if those things can sell out in amazon and prime and some of this stuff starts taking the share. this stuff will be in the hurt locker for some time. >> let's get in the money and find out. what do you say? >> they will report may 19th. you can isolate that earnings event. i think there is an interesting trade set up. i hate pressing stocks on a down day. when you think about it, you may want to think about a put calendar, trying to isolate that may 19th earnings event. today the stock was trading 56. can you do a may 13th weekly. that's two weeks from today. may 20th, regular 65 strikes put

calendar, who are you doing there? you are selling the may 13th, weekly put at 50 cents, you are buying a regular for a dollar. that is your max risk. what you are trying to do is get to may 13th. have the stocks move down a bit. have that expire worthless. offset the decay of the longer dated one you own. then have you this put you can ultimately turn into a vertical spread. >> this is an interesting case, oftentimes when you have relatively low volatility stocks like wal-mart, you don't mind going out, buying the outright put. this is a stock. it doesn't typically move that much on earnings and applied volatility t. price has ticked up for the broad market and for wal-mart specifically. so you get to basically mitigate half that expense. now you cut the amount you are ricking in half. you get a downside for a longer period of time. if you have aing shoing move to the downside. >> between now and -- >> i am sure you are watching

the trim lines, in effect, from the absolute low a. break is usually, gives you more. >> yeah. >> okay. final word, don. >> this is the trade. when we talk about earnings trade, you got to get a lot of things right, direction and magnitude, this trade is helping you not be so right and keep you in the game up to this earnings event. i look the idea of this short put calendar. >> moving on, a huge boost to commodities like gold. here's what our own carson worth said about bouillon weeks ago. >> we know the interday low the hundreds spot 2, 3 that's a $22 rise. we've given back exactly a third. 7 times 3, 21. one-third retracement. we bounced quite well and closed almost at 117. have you the visual there. there is an opportunity by my work. we would get long gold if are you not already there.

>> that was a view a couple weeks ago. now the chart master sees another way to play gold. >> you know golds continue to climb in general. the gold minors, a lot of veering on lever annual by virtue of death. they have come to life in a crazy kind of way. we have some carts that will put this into perspective t. stats here. i wanted you to start with this. this is the actual gld from its structural low and the gold minors. you will expect the kind of thing with beta and leverage associated with an equity versus a commodity. but at this point we think this is a bit overdone. so again 100% versus 24. i want you to look at since the data begins, the index out of philadelphia, gold and silver. what we know is this ricochet is now the steepest. it's three months. it's the steepest three-month move on record.

it is drawing in, forced to cover people right late and getting involved, which we think is late. so a couple things i want to look at. here is the gdx and what the top panel is simply the gdx and it's 150 day moving average. what the bottom panel shows is the percentage above the moving average. we are right now at 52% higher than at any point, at any point in the past ten years. so again, you can use phrases like overbought or crowded or complacent. we think it is pricing in a lot a. couple of things i wanted to look at, you can draw your line this way. you have something of a downtrend you have reached and so, here's our day-to-day chart. you know, we've completed this formation. you had your head and shoulders bottom. we think it's going to stop here. so if one is long, it captures these games, i would grab some him if not, we think you can

catch this as a short. it's likely to fall back here. so we want to sell gdx. >> sell gdx. pike, what do you think? ? first of all, it was a great bullish call he made. there are not too many times, you get to make the call. meantime, one of the things that sharp move has meant is option premiums have gotten high. financing a bearish purchase will get kind of expensive. if you take a look at the straddle itself basically. gdx going up, that's fine. the cost and puts will cost you over 10% of the gdx. what i'm looking to do is try to help finance a longer dated bearish purchase. specifically, what i was looking at was the may july 2005 put spread. you can spend $1 pay $2 for the may puts for $1. cut that cost in half. that first option will expire in less than one month. you have until july, though, for

the bearish bet. >> this is a wonderful way to do it if you want to pick a topic. i agree with everything these guys said. with wal-mart, you need to find ways to finance option. we know it's a little volatile. think of the slow creep we had for two months now. that's hard for long premium "options action." one point about the gdx. the top seven strikes of open interest are all put. people have been trying to do this. thedown 18th puts. the june 14th puts. may 18th puts. trying to pick a top business the way they do it makes sense. >> there is structural versus tactical him structurally, if this debt disaster that we all know it is is going to play out the way it does, gold can go much higher. after a tactical basis, your biggest three month move on records we thinks captures gains here. >> going out to july, what could cost june and other commoditys

to fall shortly? maybe you get something ingion or breathing about it could obviously cause. that you are not likely to get it between now and may expiration. which is the reason i chose the may expirations i did. >> by all means, tweet us at "options action." for everything apg"options acti" check out our website, optionsaction@cnbc.com. here's what else is coming up on the show. is this my fault? >> no, siri, it's not. but apple shares are tanking and the pain could soon get worse. we'll explain why. plus. >> help me, help me. >> a that's what one group of stocks is doing him we'll explain when "options action" returns. show me movies with romance.

show me more like this. show me "previously watched." what's recommended for me. x1 makes it easy to find what you love. call or go online and switch to x1. only with xfinity. herthey work hard.ade, wow, that was random. random? no. it's all about understanding patterns.

like the mail guy at 3:12pm every day or jerry getting dumped every third tuesday. jerry: 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. td ameritrade. >> welcome back to "options action." i'm dom new chu. there is no doubt apple has one of the biggest story lines, after the biggest company disappointed quarterly results that stunned investors. it didn't happen apple stock fan carl icahn told cnbc viewers he sold out of the position either. after all was said and done, apple had its worst week since january of 2013 and it lost $265 of market value. >> that at lot of money.

let's put it this way. $62 billion what apple lost is worth more than market caps of 4 her to members of the s&p 500 index. it's like perspective here, losing the entire value say of an american express or a biogen or it's worth two valero energies or worth three hormels. a slew of analysts took down their average price targets. they forecast a 34% gain for apple shares. now it's about whether the stock has caught the attention of some of those value-geared traders. back over to you, mem lisa, i mean, simon. just kidding. i knew it was you, simon. >> pretty much have a good weekend. let's send it over, how do the charts look here? >> if we know an uptrend is defined, clearly an uptrend for quite some time, higher high, higher low, a downtrend is the

opposite. that's what we have been in for the better part of a year. higher high is lower lows. you can draw your lines as charters or tech fixes are inclined to do. here's another way, a triple top. another way, we come back to the new downtrend. we're failing. here's another way, can you call it a head and shoulders top t. reality is we are hovering ominously at these lows. ultimately to my high, anyway, we have low tore go, perspectively down here filling this gap him here's the long-term chart. again, we can put in our head and shoulders, your brick and trend. but the reality is it looks lower. as a minimum, i think we can come down to this long term value. that will give you $80 bucks. that's where we close today at 94. >> wow. >> what's interesting, i was one of the people looked at this earlier today saying this is getting too cheap. because of earnings, the company

had suspended any potential buy backs. i figure they could be stepping if, buying some shares. i ulty got short the may 90 puts. as i began to think about it. somebody asked me, what itself the cheapest valuation apple traded at in the last sen years? i thought this was it. actually it isn't. you go back to 2013, it was trading just over six times earnings at that time, which would represent the high 60s from here. i tell you what i did. i actually bought those puts back and put a different trade on that essentially we'll be willing to give the stock at a lower level. it's willing to make some money if it declines further. specifically, what i was looking at the with the june 90 put spread. abbott one of the 90s. i should two of the 25s, collected 21 cents is what i ended up paying. you can probably get it better than i did, 20 cents.

you will make close to five muk bucks at june expiration t. profits trail off, you will get long down around 80 which is a being discounts from where it is trading. it is cheap, it has been cheaper. >> well, cheap gets cheaper. here's the problem with this stock you still, the big money has been selling for basically aer 82. you have a problem here the south side is totally offsides, there is still like 44 boys. six holes in one cell. at some point, they will reka pit l.a. they still think the stock is somehow intimately died up to it. when you think about it. you use the term no brainer with apple. there is a no brainer level. it is probably somewhere closer to that long term uptrend. at that point their cash balance is basically going to be 50% of the market cap t. one issue, i believe this stock can go down to the mid-80s or carter's level, is in the year ago period that they reported, they sold

$40 billion worth of iphones. in the quarter this year, they sold $33 billion. something fundamentally has changed here, i'm not telling you, it's a disaster. it has the potential to do on the downside. >> you told me something, after you have a big cap stock like this report, it trade at fair value. butts hundreds and hundreds of man and women hours have gone into what it's worth. this is as close to fair value as you got. >> when you get a reset, a gap associated with news, up or down news is always reached, markets are closed. at that moment you have thousands of man hours, marks are inefficient. so they will gap it to where it's the man hours suggest it's worth. but you don't actually stay there after you gp up, you go higher typically. markets don't actually gp it to where it belongs. >> yeah. and where you are calling it to, long term trend? >> up next on the program, it's

been a brutal week for biotech, but one of our traders sees the group bouncing. he'll tell you why when we return. i'm here at the td ameritrade trader offices. 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 and 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. td ameritrade.

herthey work hard.ade,

wow, that was random. random? no. it's all about understanding patterns. like the mail guy at 3:12pm every day or jerry getting dumped every third tuesday. jerry: 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. td ameritrade. i'm spending too muchs for time hiringnter. and not enough time in my kitchen. (announcer) need to hire fast? go to ziprecruiter.com and post your job to over 100 of the web's leading job boards with a single click. then simply select the best candidates from one easy to review list. you put up one post and the next day you have all these candidates. makes my job a lot easier. (announcer) over 400,000 businesses have already used ziprecruiter. and now you can use ziprecruiter for free. go to ziprecruiter.com/offer6

>> we have yahoo's marissa meyers. >> simon, we got an update on meyer earned 2015 a total of $36 million. that is a 15% drop from fren 2014 when mayer earned 22 million the stocks losing about 30%. so this is an interesting thing to consider as we await further details on yahoo's strategic move in selling itself. >> how long do you think she's got? >> until they sell it. she is out. for you'll intents and purposes, since she took over, the stock is up 15%, probably little to do with her. she destroyed a lot of value. that's what the ceos get out there, 35 million. time for the upside call. we look back on the winning traits. last week, dan said this about

tech. >> i want to look out to september expiration. i want to do this right before apple's earnings on a little bit of a bounce today t. stock or etf was 43-and-a-half. you could look out to september expiration and buy the september fray 39 put spread and sell one of the 39 puts at 75 cents. that's costs you a dollar. >> that is your max rick. >> the xlk has fallen 3% west virginia are you doing now? >> you stick with it. i think it will play out over multiple quarters here. i think it will be a difficult lear like last 84 was, not for the names, but i think the ship has sailed. they have done a lot worse. facebook traded way up and started trading off. i think additional week e weakness could follow. >> so another 5, 6% on a catch-up trade for ibb which would give us more convergence

here. we like this long. we want to be there. >> i think the simple way to make this play. by the 320 call spread, that costs about $5 bucks. you are spending 1.5%, that will take you through to june expiration. >> it's been a tough week. what are you doing now? >> with gilead, that smoked the whole thing t. principle here is we are wanting to play this as a heads you win, tails you win. if the market will get if real trouble, we think it will outperform. we like it as a catch-up. >> we are down three bucks and change, 1.5% basically the level of index. one thing i would do here, around the 235 level. i like selling puts. you can put this into a call spread reversal. a lot of the constituents of this index are really quite cheap.

gilead as a result this week not withstanding. >> guy, thank you very much. coming up on "mad money" tonight, cramer has three hot executives talking dividends, consumer confident and a shift with stocks with the ceoed of american electric power, colombia sports wear and et property. you don't want to miss that next on "mad money". up next on this show the final call from the "options action" deck. td ameritrade.

shoshow me more like this.e. show me "previously watched." what's recommended for me. x1 makes it easy to find what you love. call or go online and switch to x1. only with xfinity. (singing alougetting to know you. getting to know all about you... getting to like you. getting to hope you like me... is someone getting to know your credit? not without your say so. credit lock lets you lock and unlock your transunion credit report with the swipe of a finger. getting to know you. getting to know all about you... get one-touch credit lock, plus your score and report at transunion.com. get in the know.

herthey work hard.ade, wow, that was random. random? no. it's all about understanding patterns. like the mail guy at 3:12pm every day or jerry getting dumped every third tuesday. jerry: 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. td ameritrade. >> welcome back. let's get some tweets. this is from tim rankens on facebook, after hours the price hit 121 post-earnings him should we play for it to hit that, 116. >> i tell you, we have soon this play out, it jumps up, what happens, it sells off, right

now, a textless week. if you are thinking of a stock substitution, though, that is a good way to think of doing it. i would buy the call him i think it could actually fall from here. >> this is the new apple. people. get on board. i can't tell you to buy it here. this is one where positive sentiment seems to be focused on. >> to make the bullish bet. this is probably it. >> the last word from the "options action" pit. >> if you have a preference, if you are long gdx take some of them. >> mike. >> i like calendar spreads using the puts, may and july 25 strike. you basically let the high premium pay for the longer dated option. >> i think wal-mart sets up as an interesting trade. we haven't seen a detailed report in the cycle yet. i think that's the next shoe to drop. >> that brings us to the end. thank you guys. time sex period. for more "options action," go to our website objections

apgs.cnbc.com. check the "fast money." "options action."cnbc.com. . zplmpblths >> announcer: the following is a paid presentation for the worx air, brought to you by worx. prepare to be blown away. [ whirring ] you're not looking at an ordinary blower. there's no cord. there's no gas. it goes where no other tool could ever go, does things no other tool could ever do. it finds every kind of dirt in every kind of space... and makes your whole home cleaner in just minutes so you get to spend more time enjoying it. the incredible worx air -- so versatile, you'll wo h