the charts and the trades coming up, plus, starbucks have been growing up big gains over the last three months. can options give your portfolio a nice jolt. i'm melissa lee. this is "options action. on the desk tonight, mike khouw, cart worth, and brian stetland let's check out some of the names seeing the most options action this week, tesla, apple,

amazon, microsoft, nvidia. small caps a merging markets and the china large cap etf. apple down from year high and year low carter, which direction do you think is more likely at this point? >> this is sort of a push for me otherwise it's a pair of twos, not a particular by bad bet. we're right back to 100 day average. the you were to look at a chart, we're right in the midrange of the last 18 months my hunk is to fade it if one wants to be directional. >> mike, what do you say >> yeah, i mean, this is interesting. one of the names that saw a lot of action this week. did see some big institutional prints and earlier this week we saw a big purchase of the

february 137 puts, nearly 14,000 actually of those were purchased. one of the blocks we saw was just over 13,000 buyer paid 375 that's relatively short dated. we're only looking up to february 17th for that, but it does seem clear. probably a hedge, but some institutional participants are leaning short like carter is. >> brian, what's your hunch? >> well, when it comes to apple and big mega cap stocks -- someone like apple we actually trimmed and sold a little bit today because i think there is some bit of a run like carter mentioned to the upside, and it's not unusual to see that put buyer come in. to me that tells me you get some pullback here. i think there's other parts of the market, when you so the gdp we're in and interest rate environment we're in, it's not great. go back to the early 2000s wasn't great for the big mega

caps i can see why people are hedging or buying a put on the downside. >> on a related note, apple won its biggest market share in china as that country re-opened. can performance keep up? that is the big question, carter what do you think? >> that's exactly the word -- rush it's beeni impetuous, impulsive and too fast, too far, and too late it's an equinox of -- uninvestable but that set the low now it's love. rallied back to a very difficult level. i would take profits if long. >> mike? >> yeah, i mean, first of all, when we were in those lows, we talked a lot about some of these names. we talked about baba, k web. actually, we were and are still long jd.com.

but, you know, this is quite a run that we've seen. we are back to a difficult level. some people have taken some profits. other i suspect are hedging them one of the biggest trades we saw all week was a purchase of 43,000 of the puts they have some time to expiration, and those will be profitable even if it doesn't blow through that strike in the near term. >> brian, your thought os writ goes near term or stay long and hedge? >> if i had a give a star rating on emerging narcotics in general, i'd give them a 4 our 5 and play to the upside we highlighted trades a month ago where people were buying call spreads and trading to the upsierkd right about this level. it's not unusual that market is totally flipped. now you're seeing put buy. i could see a correction 5%, 10%, back to the downside.

it's had quite a run i would sort of limbit my exposure. >> another thing etf trade rers turning bearish on, home construction do you see this reversing course >> we've got a tale of two we've got dedicated home builders but the big sort of related stocks -- that's home depot, lowe's, sherwin williams, nothing short of a disaster. downtrend in effect since the high i think we're fading here. >> mike? >> this is a situation when you're thinking about the suppliers, bear in mind that lumber prices have gone back up. not to their all-time highs but elevated from a historical perspective. copper prices, too but maybe the biggest issue in addition to seeing higher rates in tof resistance in home -- ten

months of new home inventory was a level that we had only seen once before, and that was during the housing bubble crash in 2009. >> wow brian? >> yeah, i mean, mike mentioned that lumber prices, lumber futures ticking up significantly in just the last couple days, last few weeks when you take a look at the home builders, i'm cautious myself. i think there's downside pressure some of the activity we're seeing suggests that maybe it's got not so much room to run. one thing, the tenure following down to 3.5% people that did buy six months to a year ago are now going to be able to refinance at lower rates, have cash in their pocket, rates are lower, people start to buy homes and take the inventory out. but this is due for a pull back. this is due for a run. >> moving along here, unusually warm winter weather, leaving

natural gas nowhere to go but down does that continue, carter >> well, this would be a so bad it's good, in my estimation. we know nat gas is down 75% from its peak there is an etf natural gas fund ticker right back to a well defined prior low. i think it holds here first. heavy to the upside today. closed well. i'm a buyer. >> it's been much warmer than normal, brian. >> it certainly has, and we've seen option activity play to the upside here. we've seen call spread buyers to the upside this is probably a way to trade this stock, because someone like ung is volatile. have seen it plummet before and never recover. i'd use call spreads or options to trade this to a concern amount of premium. obviously the sell-off is big. carter highlighted the lows here maybe it's a fourth step-in.

>> what do they call gnatty? the widow maker? >> yeah, i would say the folks at amaranth would agree. there are some who appreciate how dangerous this could be. i'm a former natural gas options trader myself. in the ung, we saw purchase of 8,000 calls, paying 75%. actually, to brian's point, i think buying the mar 10/13 call spread is better that would cost 80 points. 10% of the current level of ung. >> what do you think of the tweak, brian >> yeah, i like it, actually that's what i'm talking about. kind of fit right in the sweet spot you're not outplaying a lot of capital. we added names like bolero gnat gas moves higher. some of the names move higher.

i like it. >> let's get to the most actively traded options, and perhaps most unsurprisely, tesla leads and account roughly 7% of all options trading on an average day. but perhaps surprisingly, what is right behind it meta so, mike, if you want to avoid the headline risk in tesla but capitalize on activity, how do we play meta >> first of all, meta is a name we actually own. it's had a heck of a run if you haven't had the good fortune to own this stock, just seeing this bounce we've seen since those late october/early november lows, i think you could follow some of the institutional flows we've seen this week the biggest print was in the february calls them name's going to be reporting earnings it's implying a much larger than average move, about 10%. you can figure that out here for those asking that question,

you want to know how much the implied move is, take a look at earnings, the straddle put them together, devise by the price of the stuck, and that's the implied move but right now, more upside. >> if you consider the move from its low, carter, it's like 60-something percent. >> yes, it's quite something, and of course that low was set after a quarterly miss after that stock dropped some 20% plus in response to the news. >> tough one for me here i would say it's best done through options. finding the strength in this ins instance, it's so persistent much more "options action" right after this

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you ok, man? the internet is telling me a million different ways i should be trading. look! what's up my trade dogs? you should be listening to me. you want to be rich like me? you want to trust me on this one. [inaudible] wow! yeah! it's time to take control of your investing education. cut through the noise with best-in-class education resources that match your preferred style of learning. learn your way. not theirs. td ameritrade. where smart investors get smarter℠. welcome back to "options action." there's a huge slate of earnings on deck. tech stocks pharma stocks and more we're honing in on two of the biggest tech stocks on the board. let's start with alphabet. brian, you say earnings spell gains here. >> i think it does we got a little bit of an

indication from netflix in terps of the streaming side of it and the youtube premium in terms of google and alphabet and what they do, so i think there's going to be some upside. i think there's potential move to the upside there. a couple -- it's only trading at about a 20 pe forward looking here, so it's not like it's a crazy valuation for the stock. hasn't moved quite as much for the rest of the nasdaq one of the two mega cap name i like and continue to hold for myself and clients so i think you can play it to the upside i'd like to use options to do that, though, after the run we've seen in the nasdaq and rest of the games. stock could move 5.5%. i'm looking to buy the february 104 call to offset that cost i'm selling the february 595 put

i think there's asemimetric here meaning to the upside, we crack through the 104 mark, i think it quickly moves to 110 if the stock has bad earnings, yes, it could go down. i'm okay owning google at that level because i think it sits there. i'm okay with that, i collect 50 cents. great way to lower cost and move to the upside. >> you like that trade, mike >> yeah, there's a couple things here a market where we've seen a lot of stocks sort of rake shea hard off bottoms, that's when these call spread risk reversals can sometimes make sense, because you're caught chasing. what's particularly appealing to me in google -- i know what forward estimates brian's looking at most are expecting $6.50 a share. of course about 7% of the share price is actually just net cash.

they've got over $90 billion in net cash, so that multiple gets below 17 times "x" cash. that's one of the reasons you can feel comfortable owning the stock at a lower price going to see slightly elevated pre premium. stock works in your favor in a trade like this. >> carter, your thoughts on the chart? pair of twos here. i suspect not much upside. better to use an options trade. >> i have to look up what pair of twos actually meant the other day. it was not good. also rewarding on thursday, amazon that stock has been on a tear so far this year, up 20% already william earnings sitting in the cart, mike is laying out a way to play the e-commerce giant mike >> amazon is a tough one for me. it's not a stock that we own first of all, let's just take a look at the good news. this is a stock that rallied

very sharply on online sales the stock rocketed higher in that pandemic basically bubble i would almost suggest, and it has come back in we're taking a look at valuatio for amazon that's roughly a level at prepandemic price one of the downsides is we're dealing with post pandemic head winds. we heard that from microsoft you take a look at better businesses, cloud, and we hear that business spending is under some pressure. the options market has a much larger than average implied move, so unlike brian where i'm not sure i'm comfortable owning it, i'm simply looking at a call spread, if you're inclined to take a bullish bet you're using a call spread because you want to sell against the one you guy, because we do use elevated premiums. i was looking at march, buying

as close to money as i could 105 calls a little over five bucks. just over four bucks a share on a stock that's 102.5ish at close. significantly less than the implied move over 8%. >> carter, how does the chart look >> in this case we're coming off a bad heavy volume drop in gap last quarter plunged from 110 to 100. i think we're going to retrace that to the upside the chart that you'll see the annotated. we have a well defined head and shoulders bottom, one, we've moved below the downtrend line, two. it was the third quarterly miss in a row that's only happened one other time in the past decade. is amazon going to miss a fourth quarter in a row i don't think so. >> brian, your take.

>> when you take a look at it, not only do you get amazon as a consumer discretionary, but cloud computing side, we heard from microsoft's call, their earnings call, that was very strong for them. i suspect that will be the case for amazon as well that place to the upside mike mentioned free cash flow with google alphabet this may be a little more volatile, amazon only playing a call spread, i like that a lot on mike's call to the upside. up next, the latte lowdown on a starbucks tde arand a new way to play the coffee chain don't go anywhere. more "options action" after this

welcome back to "options action." earlier this month brian laid out a way to sip on starbucks options if you thought shares were a little too hot. shares went lower but recently

surged brian, what is this new caffeine call >> i kind of got it wrong. when we first put the put spread on, the stock had a pullback i expected a little pullback, then expiration, this thing went out worthless and the stock went out higher i think put spreads make very good risk reward, especially after the stock made a huge run. traders expecting over a 5% move after they report earnings still, that takes to stock, if it's negative, to the downside we're talking about 105 to 104 i'm looking to buy put spread. a lot of exposure to edm buying the march 110/1 hundred put spread, the cost is only $3 and it can pay $7. if it goes below 100 seems like a good hedge. if it reports well, great. caps 5% or whatever to the upside, maybe retest highs at

120. but i can stay protect in the a stock position that still has decent fundamentals. i just think it's been overrun at this point. >> mike, what do you think >> i think the valuation looks awfully rich here. four bucks is what they're expecting for full year 2024 i should say fist kl year 2024 that's the highest the company would have ever learned on an earnings per share basis, and it would be 27 times that number? that's pricey. over 30 times what we're expecting this fiscal year it's priced for perfection i realize coffee is a hard thing to give up, but it really has to hit everything right to justify the current price. >> it's like 7 bucks a cup seem like a no-brainer to give up carter, what do you think of the chart here >> this has been one of the best performing large cap stocks. it bottomed way before the market in spring never dip in the october but the problem is just what you've heard -- it's come too far. it's full, expensive, whatever

word one wants to use. i'a m seller. >> all right up next, your tweets and the final call good luck. td ameritrade, this is anna. hi anna, this position is all over the place, help! hey professor, subscriptions are down but that's only an estimated 15% of their valuation. do you think the market is overreacting? how'd you know that? the company profile tool, in thinkorswim®. yes, i love you!! please ignore that. td ameritrade. award-winning customer service that has your back.

welcome back to "options action." time to take some tweets our first fan asks, with the higher trading volume in options, do you like cboe? chart looks all over the place what do you think, brian >> i own the stock, but i don't necessarily like it. the whole concept is vix options and s&p options. they're listing grain. they have tight markets it's cheaper to trade it's going to be a disruption for the vix, so i don't like the stock right now. >> our next tweet asks, how bullish are you guys on etsy >> carter, how bullish are you

>> i would say very bullish. large long textbook bearish to bullish reversal buy >> i wouldn't have guessed that one. time for another tweet this one asks, why is vix below 19 going into -- mike, do you agree? >> damn right, i agree it's amazing we could easily be surprised i'm talking about like february 24 weekly 397 puts we were below that level just about a week ago, so why not >> all right it is time for the final call. last call from the options desk. carter braxton worth, what do you say? >> buying the dollar uup is the etf. >> brian stetland? >> google. tell like it ahead of earnings next week. make it cheap to own the upside.

>> mike khouw. >> i love that question we got options premiums have come in quite a lot. big news, i think buying puts makes sense. >> that does it for us see you next friday 5:30 p.m. eastern time for another show. don' my mission is simple, to make you money i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica other people want to make friends, i'm just trying to make you a little money my job is not just to entertain but educate and teac