probable coming to you too because they're in your state and what are you hearing about privacy concerns and how do you balance this all out >> if i was talking to you last year and the big debate in this state and this country was the work california was doing to lead in the privacy space. we were referring to some of our data, collectors as data frackers in a pejorative term, meaning there was a lot of consternation and you guys have covered this ad nauseam. it's predicated those partners are aren't maintaining our policy and we have the chief data officer and one of the ctos during the administration and they're advising us, and it is so pleased with the work mark was doing with the open arces is, if a nonindividual or programized way including apple,

google and others as you noted that will help us supplement or support the, forts of the individual tracers and an army that we're all starting to build and train to be able to ultimately move back into an economic point where more of our businesses are opening up every hour and not just every day or every week >> yeah. there's a lot of discussion there and you're offering us a little bit of hope there gavin newsom, the governor of california, mulvaney's in sacramento and a shout out to gardenia bread, encinitas, valley junior high school. thank you very much. i do appreciate it, sir. >> very grateful thank you. >> take care all right. do not go anywhere tonight we have a very special friday night for you, jim is off so no "mad," but we'll be doing another full hour of "fast money" from 6:00 to 7:00 options action is ahead 5:30 to 6:00 and from 6:00 to 7:00, 3:00 to 4:00 where we were talking

about fast money you are watching cnbc and the dow is up today. we're back after this. there are times when our need to connect really matters. to keep customers and employees in the know. to keep business moving. comcast business is prepared for times like these. powered by the nation's largest gig-speed network.

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to another "options action" special on a friday at 5:30. we are joined by mike khouw, tony zhang and carter worth. the market's closing another wild week of trading in the green, but check out the real winner, who else, but amazon jumping more than 16% this week adding billions in market cap making investors money and adding a few billion to jeff bezos' bottom line, as well, and shopping amid the pandemic mike khouw, this will be a long term winner and what's your take on amazon and the big move we saw this week? >> yeah, so let me start with the first question, is it going to be a long-term winner and the answer to that is clearly that it is going to be. the trend was already moving in that direction if we think about it i think most people for years have thought that the day will come when the gross revenues when a company like amazon will receive those of walmart unless

walmart happens to pick up their online presence and that's inevitable, but i will say that this seems a little bit stretched to me. we've seen a lot of people chasing the stocks that they think will be winners in this and maybe not considering so what the valuations are. >> carter, your take all right. carter worth, are you there? >> hello >> we'll get to the chart master -- are you there, carter worth? >> i'm here. i can hear you >>. >> give us the charts in the lovely green sweater i hope you and your his a great week tell us what the charts look like on amazon >> good enough week, you, too, brian. we know it is a conventional breakout and we know in principle why people are staying home and shopping.

the interesting thing is, of course, that if you look at amazon in and of itself, perfectly healthy, the breakout and the stock that's made no progress in two years is not a stock that after breaking out typically you fade, but the big issue is the sector overall. and so you might have a few charts here and the first is a chart of the actual s&p 500 consumer discretionary sector as we know it, as it's market cap weighted by standard & poor's and it's a huge recovery take a look and we're only 12% off the high, but if you take the sector and look at it on an equal weight basis, we have a different story and the second chart before you is just that, and it's some 30, 35% off its high, and the third chart that really puts you into relief here is the comparative chart of the two and really, the message is this the true story of the consumer is the equal-weighted chart and

all of the autos and the homebuilders in the chart, all of the restaurants and the fitness companies and so forth, retailers and at issue now is this spread between the actual sector market cap weighted and the equal weighted sector is at a record it's never been this wide going back some 20 years and so at this point our thinking is you actually are well served to short xly and the etf that measures consumer discretionary. >> all right, carter thank you. we'll see you in a couple of seconds. mike khouw, what's the trade, then on amazon >> so anybody who has been observing the market realizes that we've obviously seen historic volatility and it still remains pretty elevated and options premiums have similarly gone up quite a lot and come in

some, but remain high. when i take a look at this situation you definitely want to think about using spreads and i'm not interested in getting short premium to make bets on something that is this extended and especially, correlation if it should rise will make sharper moves possible so i'm looking out to june. the 105-90 spread on xly, that was just under $3 when i was looking at it earlier today. in essence, you'll be spending about 3% or slightly under the current level of xly to make your bearish bet here. so not taking a great deal of risk for your directional bets and of course, if volatility starts to come in, that will be mitigated somewhat by that put that you sold. i would urge people to consider one thing. when you trade vertical spreads and the underline goes rapidly down to that strike it may not maximize that value and this is a trade that's playing adrift to the lower strike or of rapid move all of the way through it

in between, you're not going get quite as much bang for your buck as you would if you were buying options and we're doing that for a reason options still aren't that cheap. >> jump in here. what's your take on mike's trade? >> i would tend to generally agree with the consumer sentiment based on a trade that i had told us about on short nike i think carter and mike might have traded it better than i have because there's clearly a disconnect between xly is currently trading versus the consumer sentiment and the data that we're currently looking at. however, the scenario that i want to point out here is the fact that amazon and home depot is a third of xly. amazon doesn't report earnings until the end of april, home depot not until toward the later end of may and it might not come for a little bit of time and that's the concern that i have here make laid out the scenario, what

happens if xly drops sharply from here. >> i think there might be the opposite scenario where you might have xly continue to move higher for the next few weeks before it continues to move lower. where i like mike's trade where he's risking 2 pant 5% to take a bearish bet, i'm inclined to perhaps sell some short-term premium looking out to may to sell a credit spread and collecting a premium if the xly continues to grind higher, use that premium to pay for the put spread that mike is looking to do that's how i would play this >> all right good trade there on amazon from a lot of different takes we appreciate it, guys tony, stick around we're coming right back to you we want to change up to virtual health care provider teledoc in these insane, bizarre times virtual medicine is booming and so is teledoc. it is jumping in the past month. if you believe the stock will move higher, tony is laying out

a way to play that take it away again >> yes so this stock has seen tremendous growth and momentum even before the coronavirus. this stock started the year at 85 and rallied up to 120 before the february sell-off and really just took off and recently put in a triple top around the 170 level over the last few weeks and just broke out above the 170 level earlier this week. with earnings coming up in a couple of weeks and i see that as a catalyst that this stock means to stay elevated above the 170 what's now support >> the company provided guidance earlier this week moving q1 revenue up $100 million for the quarter and that's from my perspective what i believe the stock is fairly reasonably priced at the 170 level given the current guidance because implied volatility is high given the earnings announcement that's about to come out and the fact that the company provided guidance

earlier this week, i'm inclined to believe that the stock will stay around the 170 level and maybe go higher on earnings. so the trade that i'm looking to make here is selling a may, 170, 150 vertical and selling the may 170 puts for $14.60 and buying the may 150 puts for $6.60 net-net collecting an $8 premium on a $20 wide credit spread. so 40% of the credit spread with the break-even price of 162. this gives me another their 10 buffer to the down side on this particular trade as long as the stock stays above 170 throughout earnings >> mike, what do you think selling a may put, $8 premium. what do you think? >> well, you just hit on it. the $8 premium is the critical thing here you have a their 20 widespread and you're checking $8 to sell it and that's 40% of the distance between the strikes and

compare this to the put spread in xly that we were looking at purchasing where we were spending less than 20% you're looking at the risk/reward relationship when you're trying to spend premium or collect it and in this case, getting it between the strikes is pretty attractive and of course, here's another way to think about it if you already own the stock would you like to sell premium against it when they've given some guidance on how they're going to do, that is e specissey what tony is trying to do and he's taking less risk in this situation because he stopped out in the lower strike in the event that they turned out to be much worse than expected. this is a situation where i would urge people if you see the stock rise and you see the spread come in, and look to cover it you don't want to be cheap options in this environment. >> carter, listen. i'm not going to let you dive into the options trade and just your take on the space in

general. you look at these stay-at-home type spaces and many of them doing well what's your take on this investors have been bidding it up >> that's right. there are a lot of stocks whose business is obviously benefited by the current environment idiosyncratic names like teladoc. the stock peaked date the market bottomed, march 24th and it was 176.40 and its relative performance since then has been quite poor >> my hunch is that a lot is priced in and that this is why you use options because if i'm a holder of the security itself i think i want to be trimming. >> carter worth there. going to be trimming if you own the security straight up very interesting trade there from tony zhang. coming up, options traders betting on a resurgence for one beaten down casino name. they're all beaten down tremendously because they're closed we will tell you the name and see if you can follow suit, if

you agree, as well plus we are wrapping up the week that was on wall street in a special bonus edition of "fast money. that's right, we'll be live on "fast money" bringing guy and tim back and victoria fernandoes at 6:00 to 7:00 p.m. eastern mende'll take it over at 6:00 and we're back with more "options action" after this. ♪ ♪

♪ ♪ ♪ ♪ ♪ all right. wach the stocks overall ended the day higher and to cap what was a decent week and now up 2%. the nasdaq up 6% and there's

update on an eventual virus treatment and the federal reserve and another reason yet stocks are higher in the last couple of weeks. the white house unveiled a three-phase plan to get restaurants and other consumer-facing businesses back up and running and options traders are starting to bet that casinos, yes, casinos could be able to cash in on that, as well tony zhang, what did you see today and what's the trade around it? >>. >> yeah, so brian, we've been getting a lot of questions from rest source on options play as to when is it the right time to get back into some of these travel stocks whether they're airlines, hotels and cruise lines and some of these names that we've talked about over the last few weeks and today we saw an interesting trade cross the tape oncaesar's entertainment that gives us a glimpse into how options traders may be utilizing strategies and options to time an eventual recovery in some of these stocks

ceasar's entertainment is a casino and hospitality stock in this particular space and the trade that we saw was 7500 contracts of a may, june, $9 call calendar and subsequently bought the june $11 calls. to understand this trade let's break it down leg by leg so the first leg that the trader sold were the may $9 call options for about 35 cents this is basically a mildly bullish to neutral view on caesar's for the next 28 days between now and that may expiration date, giving the stock about a 10% to 12% upside in the mean time and once that may expiration expires, this trader bought the june $9 call options which they paid about 80 cents and the june $len call options for about 20 cents and the break-even prices on those particular trades are 20% higher and 37% higher so this trader is betting that in the next month, the stock is going to stay mostly rangebound

and mostly trade higher and significantly take off between that may and june expiration so that's how we can see how other options traders are currently utilizing the options market to time a potential bottom for these types of travel stocks >> okay. mike, what is your -- what do you make of the trade and what do you think of the potential bottoms for travel stocks in general because pretty much nobody's traveling and has no plans to for a while >> yeah. so this is an interesting situation because with the casino stocks in particular, i mean, we're obviously hearing that in las vegas, for example, some of these guys are talking about ways that they can re-open or partially re-open and you know, these are also levered names and they're levered to a re-opening and they're levered to a rebound and how consumers will go out and spend if they do re-open. so there are a lot of unknowns

and the options are the only way to play and the stocks themselves are the only way becoming options the thing i like about the structure is normallyin spread they're trying to capitalize on the premium they have on the front end and if it get away from you, you can have the trade if the stock goes way up or if it goes way down by creating two strikes that they're long in june, they're preventing any risk to the upside and that doesn't mean that the stock doesn't crater that they're not going to lose and they're not going to lose under any circumstances, not near-term or longer term that aspect of it, i do like >> all right good stuff there, mike and tony. as we head to break, be sure to call it a bonus hour of live, fast money and jim and the gang a well-deserved day off so we will be live bringing back tim and guy as well as julia fernando and mike khouw will tech around for another hour another full hour of "fast

money" 6:00 to 7:00 eastern time we're looking forward to that. right here on options action, you asked, we answered some of the your key options action, each in these times we are on a mission and we are back with more "options action." ♪ ♪ ♪ ♪ ♪

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decent frida good week. it is time to take your tweet. after a rough day today, what do you think next week will look like, carter worth, for apple. we got a big goldman sachs downgrade to sell today. >> apple didn't offer protection on the way down and it was in line with the market and its relative performance has been stalling ever since. it's a darling it's perhaps overowned and i think that downgrade made a lot of sense i'm a seller of apple. >> searle of apple wow. our next viewer asked this are you still expecting a retest of the s&p back to 22 to 2300 levels or, tony, have you revised some of those expectations >>. >> i still think that that's a possibility here, but later in the year as markets can overshoot to the downside, markets can overshoot to the upside and that's currently what i think we're seeing right now

as the market continues to move higher, i'm looking to fade those types of moves by selling call credit spreads and buying put options to protect myself from further downside moves. >> all right finally one fewer asked this i see some put buying in crude oil. mike khouw, former oil trader, do you see crude dropping below 16 bucks that's a long way down for sure and we did see some bets that it would drop as low as that in the july futures and the wti on the nymex and russia and the saudis did reach a detant and we'll have a record import from saudi arabia coming to the gulf coast and we have a real glut and that's a problem for oil prices and 16 might be lower than i would expect and i do see weakness over the coming months still. >> yeah.

by the way, to your point, mike, there are vlcs and super large super tankers that are on their way to the gulf coast. we will see a huge influx of oil and some oil traded today in texas in the low single-digit ranges guy, thank you very much except for mike because we'll keep mike around that does it for us on "options action." we will be back next friday at 5:00 p.m a bonus "fast money. guy and tim are coming back and mike khouw will stick around and victoria fernando will be our guest. we're not done we have a live hour right after this short break we'll see you on the other side. i'm searching for info on options trading, and look, it feels like i'm just wasting time. that's why td ameritrade designed a first-of-its-kind, personalized education center. their award-winning content is tailored to fit your investing goals and interests. and it learns with you, so as you become smarter,

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