>> hey there we're live at nasdaq markets on this rainy day sunshine. here's what's coming up on the show. [ music playing ] >> oil has come bubbling up to a three-week high, traders see more room to run. we'll tell you just how high. plus, how hot are facebook shares? >> hot! dam hot! real hot sclts. >> but something happened today that might want you to take profits. we'll tell you what that is. and, have you missed out on the rally? >> dorn darn, darn. >> relax. we have the group of stocks that

can catch up to the market. we'll explain t. action begins right now. >> let's get right to it. starting with a big week for big tech. amazon and apple making multiple highs, facebook both at a high adding to the tech rally here. stocks at record levels. you stick with technology. let's go to the money right now. mike, what do you say? >> we are about to hear from carter on this, i mean until we are about to, i would have to say usually you would stick with what's working and you would stick with growth and you would also stick with something that people don't seem to be able to short. amazon certainly falls into that category. so you know when i'm trying to look for a place, you do see top line growth or consistent eps growth and this seems to be the sector where you see it. but valuations are the worrisome thing for me from a fundamental point of view. >> do you think valuations are out of happened? microsoft hit a new high? >> i don't think microsoft is out of hand or oracle, for

example. >> there is definitely the haves and the have nots from a valuation perspective. you can look at a name like netflix and they that is a heavy valuation. and they have to hit an owl cylinders. amazon that's just true. >> we were talking amazon, they are not tech. netflix is not tech. meaning it's whether you are using credit growth, large cam things prevailing independent of the economy are maybe overdone. it's tech as a sector. it's some of these names individually that have come a long way. >> quickly in terms of netflix, know, can we give them? maybe they're play hack long game and are not focused on quarter-to-quarter, the fact that they are burning quash, admittedly so, maybe it's a ten-year land grab. right now they have 7 or 8% of the television market globally. think about that although i hear you on the netflix valuation, it's crazy. maybe they're into this for much

different reasons. >> or amazon. >> the truth is if you look at the bottom of what they're doing, amazon or netflix. they don't seem like tech companies. uber you can arguably say. tech is what is propelling the story there. you can take over driving people around with technology. can you take uber retail with technology. you can take over the entertainment business with technology. that's what all of these companies are doing. all of them are doing the lands grab. jeff bezos is quite successful. >> tech, i have one of the biggest tech clients, he says, carter, i own a big defense contract. those are the biggest tech guys of all. they're building a missile. there are many ways to get tech without baseball and so forth. >> despite the huge rally the trump master says it's time to hit the unfriend button on one tech. >> is it tech, facebook, consumer? a partner stock, it's a super cap name and it's come a long

way. let's just start with a few things. so just to put it all in perspective, i thought i'd start with the top three winnings by sector in the s&p. what we know, of course, this is the gargantuan, right, microsoft and goog. p one, it's reaching -- there have been no time where it gets much more than 30%. keep that in mind. then let's look at a few things, two oust four stocks, fang, the weight of these four is at 6%. if you have microsoft, and let's talk about facebook, first of all, fang, that group, are going to get to facebook, that group, top chart, those four charts broke out to a new high and yet they have not made a relative new high since october.

they have been on the market. five months straight, fang, up, new high, no relative high. meaning having been in them five months is a dud. since october 24th, you have done half as well as the market. that's as one has gone higher aed higher. so, facebook cart, five years, here's what my eye sees. a trend. and what i think we've got here is we're getting into the outer limits of what is likely. we're up closer to the top. i want to fade this. i think the stall in fang generally means something. this recent database is quite steep. so i'm making a venture to come off here. sell facebook, right call. do something. >> mike. >> just as i was articulate. this is a company that doubled free cash flow, so it's ha ready to think the whole story is going to roll over. if it is at the top of the channel. if you expect a modest pullback, one way is by selling the may 140, 145 call spread.

you collect your $2.60 t. most the spread can be worth is $2. you sell it for $60. if you flip a coin, if it stays here, you check a premium. if it declines, you will make money. if it rallies the most you can sloez $2.40. obviously, it's hard to pick tops in stocks that have been obviously outperforming over a long period like facebook has. >> dan you are watching cap one, thanks for having me on. >> would you agree with this trade the assessment? >> yes. i have been a huge facebook fan. i still ham. i watch this show sunday nights 80 homeland." i thank you very much. why do i even bring it up? because the theme has been, this is actually a serious point. this whole fake news this propgation of trying to sway

public opinion, that's actually if you look, without question, there is something like that going on. i think the biggest one that loses to that is facebook. i wonder if they address it in the court or if advertisers potentially start to pull away. so as they report april 27ing, i think. if you have been long the stock for the run, you got to take money off the table, based on what these fix said or i said as well. >> if you are in an environment where banks are weak and energy is relatively whatic to the markets, does facebook get pushed higher because of the gravitational pull? >> it's gone from 115, on a year-to-day basis, it's ahead of most of its fierce when you consider it fang or not fang, it is growth, whatever you want to call them. it's an unsustainable angle at this point. >> the way i would think about is this, obviously you look for areas underperforming and playing catch up or you are concerned maybe there could be overall weakness, they will see weakness, either way, it seems

like it's had quite a run in the short term and it could be poised for that. >> let's go on to crude, jumping nearly 6% this week, that's bullish bets on oil fund etf, about two times the average ratio of calls to puts. we saw bullish option bets on other etfs this week. what does the "options action" market know? >> i think the "options action" market knows maybe this crude market that everybody sent crude oil down, maybe we put in a short-term bottom a. couple stocks are trading that way. conoco philips, peter najerian saw it this week t. refiners may have found some ground. i mentioned soros doing "fast money" i'll mention now again, i think if you look for a trade. tso gets $80. if oil you think is back on its way to $55, you play the levered names like an ana darko

petroleum. >> one of the things i point out, you talk about refiners. one of the big things we saw brent trade over west texas, usually we had a glut of crude, in cushings, mid-content refiners were able to benefit from that. now we see the pipeline project looks like it will go through. where is that going to be deliberating crude to alberta? the illinois refiners, refiners in cushing, oklahoma. now a lot of that can stream down to the gulf as well. so i think both of those stares. >> i think it's trapped there. >> really? you have all these, it's again racial buy here. >> i mean, first of all, think about it. there were two things that were guaranteed when this year began him you have to own fnlts, because interest rates are going higher, total disaster t. second was crude is set up perfectly at $52 a barrel. opec is now on board. it's off to the races, total disaster. sometimes consent is great. but sometimes it's exactly

wrong. just because crude goes up for two or three day, i don't think it's changed at all. if you look at the christmas group contract, christmas '18, it's projected no -- >> that is a fair point. 2018 crude oil is off six bucks anyhowe since the beginning of the year. we definitely seen the curve flatten. >> that actually isn't the issue. when you look at them. they are consumers of crude. they aren't sellers and producers of it. so if the commodity you buy goes down in price the curve long term is indicating it has, you sell a global commodity. you will ultimately end up benefiting. >> you have beautiful voices. it's the softened tones. >> the contrast. >> i'm a bit of a neanderthal. >> did you see us in "fast money"? >> yeah. >> i know we got to go to break. >> a question out there. tweet to "options action".com.

while there, check out our newsletter so what are you waiting for? in the meantime, here's what's coming up next. >> here's what reits have done this year. but there's something in the charts that suggest now is the time to buy. plus, calling all "options action" fan, reach in your pocket, grab your phone and tweet us your question back to "options action"actions. if it's nice, we'll put it on air when "options action" returns. >> logical. "options action" ♪ guyhey nicole, happening here? this is my new alert system for whenever anyoptionsens. options.

but thinkorswim already lets you create custom alerts for all the things that are important to you. shhh. alerts on anything at all? not only that, you can act on that opportunity with just one tap right from the alert. wow, i guess we don't need the kid anymore. custom alerts on thinkorswim. only at td ameritrade. i just had to push one button wto join.s thing is crazy. it's like i'm in the office with you, even though i'm here. it's almost like the virtual reality of business communications. no, it's reality. introducing intuitive, one touch video calling from vonage. call now and get amazon chime at no additional cost.

so you'rhow nice.a party? i'll be right there. and the butchery begins. what am i gonna wear? this party is super fancy. let's go. i'm ready. are you my uber? [ horn honks ] hold on. the biggest week in tv is back. [ doorbell rings ] par-tay! xfinity watchathon week starts april 3. get unlimited access to all of netflix and more, free with xfinity on demand. hey nicole. hey! i just wanted to thank your support team for walking me through my first options trade. we only do it for everyone gary. well, i feel pretty smart.

well, we're all about educating people on options strategies. well, don't worry, i won't let this accomplishment go to my head. i'm still the same old gary. wait, you forgot your french dictionary. oh, mucho gracias. get help on options trading with thinkorswim, only at td ameritrade. >> welcome back to fast, i mean "options action". as we close out, one of the things worth noting is what's happening with the treasury market. they have ten-year yields hovering around that 2.4% mark. after ties of 6.1% a few weeks ago. it put a bid into bond proxy type stock, they pay high difld itself, utility, consumer staples, telecom stocks.

interestingly new, that trade has been becoming undone this week, despite longer term yields since last friday, it's these rate-sensitive sectors among the worst performers in the s&p 500 during that same time span here t. consumer staple sector is up a tenth of a percent this week. telecom services is down about a half a percent and the utilities the worst performing sector down a full%. perhaps interesting though, the real estate sector which has been the notable lagerred has been slowly crawling higher. the vanguard ticker vnq is on a multi-day winning streak, so mel lisa, some great proxy stocks are doing better than others as rates stay pretty static. back over to you, guys. >> you better get the shows right, "options action" starts at 5:30 p.m. eastern time. rates by carter. >> what a great setup. exactly right. you have this one group that's

lagged, that's now coming to life. let's put this in optical terms. i have two lines, one's blue, one's orange. you can see what they are. look at the spread over the past year or so between utility itself and reits. utilities have done twice as well as are highly sensitive areas of market. let's pull back longer. this is a two-year chart. here's your spread. they were up this week. you have the set-up of under performance. here's a five year. reits lagging by half as much. that's your opportunity, but you only do it once it starts to happen. meaning, now they're starting to, they have to all this week when the others did not. so, how do you draw the lines? you could draw them like this, something of a hid and shoulders boll to him. you can draw them like this, a wedge. but what i see is higher and i this i the action this week is telling. then finally, since they are

sensitive. let's talk about the facts, utilities are paying 3 pin 1. ira is paying. . that's not nothing. i wanting to long reits. >> this is like an ultimate would you rather. >> let's play the game. can w we do this on "fast money" for there's that don't watch. >> i think reits in this -- now if you go back and look ever a the last five years, you are talking about apt instrument that's made a series of higher highs and higher lows. and i think that pattern is still in force right now. so yes, if you are asking me which one, the iyr, i think it pushes back towards the 85 level that it failed back. >> michael. >> i think this in case looking at yir, you can look out to september, by the 79 calls, you can spend $2.40 for. that we have spoken about this afternoon. we have this week talking about having three more hikes this year. when the shortened of the curve

rises, that actually helps keep a lid on the long end of the curve. what you are trying to do is control inflation. also, these real estate companies are big borrowers, so they will benefit from lower long-term rates, even if there is some degree of inflation, assets, in general, they will be net beneficiaries. >> there are ones that are terrible. the ones using the malls or outlets, those have structural problems. as an assess class, reits are a good payer. >> in the re its, is there a concern there are more pockets more trouble than other pockets? >> which is interesting, this is a philosophical question. what these instruments allows to you do, it hides, it has a masking effect. >> weaker things. >> for weaker things. it can be a devastating thing. but we haven't seen that yet. >> if you have the, basically,

the second tier mall operators, that's challenging. they can have long bae. >> i think it's off. >> shares of nike still down after last week's earning, it's bad news for mike and carter who says they'll give us the next step in the trade when we come right back. [pony neighing] what? hey gary. oh. what's with the dog-sized horse? i'm crazy stressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal. isn't that right warren? well, you could get support from thinkorswim's in-app chat. it lets you chat and share your screen directly with a live person right from the app, so you don't need a comfort pony. oh, so what about my motivational meerkat? in-app chat on thinkorswim. only at td ameritrade. and the wolf huffed like you do sometimes, grandpa? well, when you have copd, it can be hard to breathe.

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at crowne plaza we know business travel isn't just business. there's this. 'a bit of this. why not? your hotel should make it easy to do all the things you do. which is what we do. crowne plaza. we're all business, mostly. ♪ guyhey nicole, happening here? this is my new alert system for whenever anything happens in the market. kid's a natural. but thinkorswim already lets you create custom alerts for all the things that are important to you. shhh. alerts on anything at all? not only that, you can act on that opportunity with just one tap right from the alert. wow, i guess we don't need the kid anymore.

custom alerts on thinkorswim. only at td ameritrade. welcome back to "options action". we got a news alert to myelin. >> hey, mellissa, myelin is expanding a recall of the epipen devices to the united states and this comes after a recall of about 81,000 devices, a couple weeks ago, or earlier this month, that was outside the united states, that came after two events where people tried to use their epipens, they didn't deploy accurately. those people were okay. they were able replace those devices. as a precautionary measure, myelin says if coordination with the fda and in consultation with the fda, they decided to do a voluntary recall of the 13 lots of the epipen, that is basically and i dent cal version without the brand ron it, mel. we are trying to figure out how

many units in encompasses in the 13 lots. we will get back to you with information. >> let's trade myelin labs, the valuation is ridiculously cheap. mike can speak far more intent gently. i'll say this, even with this epipen it's cheap. they priced it 44 million share secondary a week or so ago at $40 through morgan stanley, in my opinion, you don't buy the stock until it gets back to that level and holds it. otherwise, i think you look for further down side t. news flow keeps on coming, it's negative. >> we talk open trades that aren't working two, weeks ago, carter imposed on nike breaking out. >> it was a lager, that's the opportunity. now this part here is better than this part here. so you are starting to get the very thing you want. which is outperformance. i like nike high. >> i was looking out to june.

you could buy the 57-and-a-half calls. this the stock was trading 5780. so these were in the money. for $2.45. >> nike shares have fallen more than 3% since then. so carter, what do you see the trends now? >> so this is almost like what you call debt run. meaning if you are betting, something that is acting well, will get better in response to fundamental news and earnings beat. it gaps down. walk away, that's all you can do. >> mike. >> one of the things of buying calls is are you kind of walking away automatically when this happens because they essentially have given up most, if not all, of their value. they are probably worth about 45 cents. if you hang on, you will lose. >> at this point in time, what would do you with nike? >> i think it came back rather nicely from that earnings miss t. stocks traded off. i think it got down to 52 or so. it hasn't gotten it all back. it's still at about a two-year down trend, in my opinion, it's got to break 57-and-a-half on

the upside. >> but i mean, the data points we're getting from this little piece of the industry, they're not very good this past week, nike is dragged down by the news out of lululemon. >> that was obviously pretty grim as well. interestingly enough, 57-and-a-half is the strike we own. on that breakout level, you already own it there. and we've, you know. >> we've lost all week. >> you were talking, it did bounce, it started to fade. it bounce, it could have stopped, that didn't help but it didn't. >> i mean, it's incredible. i love it here, dan who? >> you want to be -- you can be the fourth trader maybe. >> you don't need a fourth. >> yeah, you do. >> it's very heavy. >> up next, reach no your pocket, grab your phone, send us a tweet. if it's nice, you might read the final call from the options desk. stay dundz. tuned. hey nicole. hey! i just wanted to thank your support team for walking me through my first options trade. we only do it for everyone gary. well, i feel pretty smart. well, we're all about educating people on options strategies.

well, don't worry, i won't let this accomplishment go to my head. i'm still the same old gary. wait, you forgot your french dictionary. oh, mucho gracias. get help on options trading with thinkorswim, only at td ameritrade.

what?pony neighing] hey gary. oh. what's with the dog-sized horse? i'm crazy stressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal. isn't that right warren? well, you could get support from thinkorswim's in-app chat. it lets you chat and share your screen directly with a live person right from the app, so you don't need a comfort pony. oh, so what about my motivational meerkat? in-app chat on thinkorswim. only at td ameritrade. . welcome back to "options action." time for some tweets t. first

comes from the west. not really. >> oh, c'mon, c'mon, of course. >> okay we miss dan, of course we do, right, guys? >> of course. >> i had to twist your arms. >> he doesn't miss us, he's on the peach in san diego. here's the next one, steve tweets -- mike. >> so you know, it's interesting, this is basically selling volatility. as long as the market doesn't move around very much, then you obviously are going to make money doing this, that said, we are in basically the lowest level of volatility you could possibly experience, so the risk on this seems a little high. >> the market is quite range bound now for about four or five weeks. i think it's going to -- i wouldn't do it. >> the final call. carter. >> i want to take some of my profits if i have them in facebook and reemploy them in reits. >> i think selling made the 145

call spread to facebook is the way to make your bearish play. >> south carolina sets up a all south carolina final. watch it mopped night. >> our time has expired. thanks, for watching. "mad money" starts right now! >> announcer: you're watching a paid presentation for veggie bullet, brought to you by veggie bullet, llc. from the makers of the world-famous nutribullet comes the next innovation in whole-food nutrition extraction. introducing the veggie bullet, the world's first cyclonic spiralizer and lightning-fast food prep accelerator. now you can spiralize nutrient-rich whole foods in seconds for incredible pasta recipes, like zucchini spaghetti and meatballs or ribbon spirals for great lasagnas, even the family favorite -- curly fries. the secret is the veggie bullet's cyclonic-action spiralizer and high-torque motor with razor-sharp stainless-steel blades for the fastest spiralizdl