we got a film made. i'm proud of the movie. everybody wanted them to win, you know, because they knew everything that they had to go through just to get to the point where we can make this film. -- captions by vitac -- right now on "oa," china's annual parliamentary meeting, set to kick off this weekend when it will chart out its economic course, what impact will it have on the emerging and global markets? the health care trade has been a horror show of late carter set to show the two titans pfizer or j&j getting his seal of approval? the defensive defense trade on raytheon. mike khouw, carter worth, and brian stutland let's get into it with the trades heard around the world this week.

the fxi, eem and ewz seeing heavy volume as traders look for gains from china to brazil and everywhere in between. what do the technicals say about this globe trotting group? carter, take us around the world in charts. >> sure, what we know, of course, on a long-term basis, emerging markets are pretty massive underperformers of developed markets. now, right now, if you look at the msci, emerging market index, which the eem is based off of, we are bet all-time lows, relative lows seen in 2000 made sense the dotcom peak. the question is now that we've gone back to that extreme underperformance is this a bit of a base and a bottom that brings up the here and now charts kwb, you could use fxi, any number of things, but that has all the elements of a bearish to bullish reversal the iteration on the screen, the moving average, the smoothing mechanism, the 150-day turning,

but you can annotate it and call it a head and shoulders bottom, see that here, and you can also call it a cup and handle, meaning the point is this is what a bottom looks like now, it's for a trade. can over time this outperform the great commercial enterprises that compose the index of the s&p 500? no chance. >> you've said you pick this one, just as an example. but really, a lot of the china charts, they -- >> look the same, fxi, eem, it's the same circumstance, meaning, extreme weakness that is giving way to strength. >> mike, you spotted some very interesting trades in the etfs start off at k web. >> k web, we actually saw a really split decision, basically, in all of these, k web we actually saw some bullish activity consistent with what carter was talking about here, specifically it was the march 32 calls, big

purchase of those, beyer paid a buck for 5,000 of those, betting on the upside. i should say, importantly, that we've been active in a lot of these names, both within ewz, and within this constituent space of eem, fxi and the k web. we mentioned one of those on "fast money" last week, jd.com bought it on friday, we still own it, up 6% this week. but we really have a split decision, when we take a look at these stocks baba has been very hard hit of late lee was -- did well coming out of earnings. and then if you take a look at bidu, i think that's a push. maybe that one was a pair of 2s and we got rid of baba and baidu this week after those. respective earning results. >> so where do you stand on kweb, chinese internet >> looking at options trades occurring over the last three months, we've highlighted these a bunch of times, very good and very right when it comes to fxi and kweb, it seems like this play to the upside buying calls

is a cheap shot. we've seen volatility option contract volatility be a little bit cheaper than what we've seen, say call it last year around this time it makes sense a trader out there is taking a shot, buying a call, playing to the upside, and it just does feel like a 2003 scenario, we're coming out of this bear market, entering maybe a new phase of a bull market, the same way we did back then in 2003 where sort of gold took off, emerging markets started to take off it kind of has the same sort of feel and maybe this last month in february, the shakeout in the chinese markets was just that, a carpet shakeout, and now it's poised to move higher. >> mike, you also saw, as you mentioned, activity in fxi, and eem, for that matter. >> yeah, so this is -- it's a good point, because these two bets were in opposite directions fxi flow was bigge than kweb, and consistent with it, we saw a purchase of 25,000 calls in there, buyer paid 78 cents for the april 31 strike. another big bullish bet. eem, that situation was the other way.

we saw some bearish activity, it was the june 39/35 put spread, that thing traded 30,000 times the buyer of that is betting to the downside take a look at the dynamics for a lot of these companies, many are cheap, aforementioned i was just talking about, baba, if you could get the kinds of growths at least people are expecting for those companies at that kind of a price, u.s. stock, you would be all over it you guys were talking about it in the prior half hour there really is a lot of political uncertainty. i think that is the key head wind i mean, steve was talking about whether or not you could buy that 5% growth, and 3% inflation number but at the end of the day, what is going to drive these stocks and like i said we still do own jd.com, and they are going to be reporting earnings, the issue here is really a political one if we see something happening in taiwan, and that $600 million weapons spend isn't anything in the grand scheme of it if they do something, that's the real risk and it is a material one.

>> i guess i view it as symbolic we're going to let this happen even before the national peoples congress in spite of what beijing has warned the u.s carter, the opposite trades, that's an interesting dynamic considering that china is 20% of the overall emerging markets index. does the rest of the index, the rest of the world, look worse? >> that's just it or conside in the eem itself, the weightings are very heavy in samsung and taiwan semi, whereas kweb that's not the case get that part right, the parts that compose the whole the common circumstance is, extreme weakness that is basing and bottoming, and they all, if you look at the sort of correlation now, it's very high. >> all right, let's now take a look, stateside, at next week's earnings, a number of names reporting, crowdstrike, docusign, ciena, dick's sporting goods, and ulta. all with big implied moves mike, run us through them. >> crowdstrike, implying a move

about 11%, higher or lower, actually a name that we own. docusign is another one implied move is close to 11%, we are not actually in that one ciena, a move of close to 9% higher or lower implied by the end of next week and then we've got on the retail side dick's, and ulta, these two names are implying 8% and 7% respectively, we don't own dick's, we do own ulta and that is a holly index name as well i should mention. this is always something you should pay attention to. if you're in these names, be prepared for that. ulta has had quite a good move recently that may be an area of vulnerability. >> what jumped out at you, brian? crowdstrike is interesting, seeing what zscaler did on the back of its earnings. >> it certainly is, and cross check's been a name that we've been pondering whether to get into that or not when you look at its valuation, it's hard to tell when you look at it in terms of what it does for you in terms of cybersecurity and the growth in

the cloud space and how it plays into that it seems intriguing as a buyer. this thing is, the stock has been beaten down so much it's lagged behind a lot of the tech and growth names even though it has, you know, kind of reached a turning point here, seems like it's going higher when you look at some of these implied moves that mike mentioned, they're enormous. on the options side. but actually when you look at basically the last five earnings these option premiums are now getting up to levels sort of pricing in that movement in earnings, crowdstrike being one of them, it may actually give you an opportunity to sell some premium, ahead of earnings, or at least in the back months later dated options against that, because these options have gotten bid up so high, expecting big, enormous moves. >> which chart stands out to you, carter? >> all of those. taking ulta, all-time highs, and mike referred to some vulnerability because of that. i'm with it. if i were long i would trim, reduce, but let's talk about docusign, the exact opposite, as opposed to ulta.

docusign, consider this, at its peak, this was worth $55 billion. it was $315 a share. now it's worth 12. and it's 65. are those highs in for all time? we're going to use more docusign and it will grow, it's the fascinating thing about markets you get so far ahead of yourself that the shares once they plunge and drop 80%, you never retain those highs. so can you trade it for a trade into earnings? okay, but more important seeing its best day >> for everything "options action," check out our website and our newsletter, more "options action" right after this >> announcer: when "options action" returns, solar stocks are soaring this week. but we've got an overlooked way to brighten your portfolio, that takes solar, adds housing, throws in a dash of tech, and puts it all through a unique defensive lens, and tint.

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welcome back to "options action," both dr. khouw, and dr. carter, we've given you a degree, carter, are counseling

on tonight's health care call to action they're combining their forces so, carter, what do the charts tell you >> well, for starters, this is an area that we've liked and it's not working, right, the question is, will it at some point? what we have now, a circumstance where certain marketing names are literally in free fall it's very rare to move from a 52-week high to a 52-week low in a matter of two or three months, that's what's happened in big names like j&j and pfizer, and the divergence between s&p 5%, and sector down, j&j and pfizer are really lagging, the question is, is that an opportunity i think it is, and we can look at the charts. what we have here, at two marquee names coming down to fairly well defined prior lows, and the presumption is that for a trade you can catch them for a bounce, j&j, and pfizer is quite similar. >> so, mike, what's your trade >> yeah, so we're going to take a look at pfizer, i think, you know, it's interesting, when we

talk about coronavirus pandemic related stocks, a lot of names get mentioned, docusign, we were talking about it in the prior block. peloton, you can talk about zoom, you would add all those companies together and the gross revenues are not equal to the exact it had for pfizer, pfizer's revenues rose from $4 billion to $100 billion, that's 2019 to 2022 in fact, if you take a look, just at paxlovid, that was a $19 billion revenu boost for 2022, and coronavirus vaccines, that is why the stock rally as much as it did. the reason why the stock is trading at less than 12 times earnings now why? that is why it is earning at less than 12 times why? because people are not expecting the boost that they received from that to continue, but the interesting thing is, take a look at the level to which it has fallen at the end of 2019, pfizer was a

$260 billion enterprise value company, about $20 billion cheaper than that now. so, effectively, all of that premium, that got built in, as a result of that enormous revenue boost they got from the -- from covid-19 treatments an vaccines, has been eradicated. i think, though, that they are likely going to experience some pressure here and there as people continue to mark down their eps estimates, which i do expect to continue to go down, that's the reason we see the multiple i think what you can do is take advantage of the fact that many of these pharma companies tend to trade at relatively low implied volatilities, i was looking out to april the 42.5/45 call spread, you could purchase that for, you know, a relatively small amount, it was about 55 cents when i was looking at that earlier today, you know, that is a way to get some participation, it's not a big boost that we're taking a look at here. there is no company that we can talk about that had a bigger imt pact and has seen it come

and go as much as pfizer >> brian, what's your take >> well, i think when you look at the whole space of the health care industry here, this is maybe a cheap way to sort of play to the upside, we've seen it contraction a little bit in volatility over the last few trading days maybe this is an opportunity to buy some cheap options in play for the direction back to the upside i do like names we own for clients like an amgen, bristol meyer, united health care, these have all struggled as well, i like those names better than pfizer but if you look at technicals, carter can speak to this, trad about 42.5 strike right there that mike is playing there's more room to get back to 45, and so it's a decent set-up trade for a call spread to play the upside at 42.5/45. >> carter, not picking an individual name, play the sector for a bounce >> that's just it. while the sector has a lot of diversification, devices, supplies, equipment, big pharma, so forth, bio tech, xlv is as good a way to play it as any,

with the big asterisk. i said that two weeks ago and three weeks ago. >> okay. asterisk noted let's move on to solar stocks having their best week in five brian, you're laying out a trade on one very specific name that offers solar exposure but hedges itself with housing tech and some more stuff. >> yeah, it's what was that winston churchill quote, enigma wrapped in a mystery or whatever that is, roll off all into one, owens corning is one of those. when you look at this stock, it had been trading at a range for a number of months held in there nicely at 2022 and it looks like it's breaking out to the upside. the thing is, you know, like you mentioned, it's got a housing place to speak in there, mortgage rates higher, it may struggle to get significantly higher, there's a head wind for it when you look at the smart home, esg kind of play, a lot of people out there on twitter, they either love esg, or they hate it.

here's one sort of in between, that gets you a little bit techie, with the esg play, and i think i want to use puts, i want to sell a put here, because a price of premium on options in the stock, going all the way out to august, i don't normally go that far out, but when we're looking at this almost 6% premium, selling the august 95 put for $6, break even down to 89, that's the area where the stock broke out to the upside. it's a pretty decent premium return if i keep cash set aside in case i need to buy the stock down there and the stock goes lower basically i think there's enough premium in these options where i can start to now sell calls if i get put to the stock, i can sell calls against that sort of recover my break even further. i think the premium is nice and juicy on here, stock looks poised to move to the upside room to grow here though not necessarily run away to the upside all the stocks have moved so big already. >> mike, your take on the trade? >> i think there's a decent chance you might end up owning the stock, because i have a feeling that with the home

inventory where it is it's probably going to come in, the purchase price you're going to end up with, actually won't be bad, below 90 or cost basis. and then yielding 2.5, maybe 3%. i wouldn't mind owning it at those levels in that sense i like the trade. all right, coming up our next guest detailing a defensive defense play, how he's setting up the names, straight made, and don't miss cnbc's live coverage at ceraweek, interviewing industry leaders including the ceos of oxi, shell, and exxonmobil, catch live streams at cnbc.com more "options action" right after this 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?

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interesting opportunity. we believe, given the fact that there's secular tail winds for raytheon, 60% of its business is defense. and what we've seen even recently is that there's been a recent contract to sell $619 million worth of weapons t taiwan and raytheon is providing the missiles, emblematic of of their defense budget. the eu is increasing the defense budget over the next three years, japan is increasing their defense spending by 26%. but the kicker for the stock is actually its commercial side of the business, which is starting to recover we know the commercial space is seeing supply chain improvements, as well as a lot of the airlines are needing more parts and aftermarket services so raytheon has this kicker for its earning per share with the commercial business coming back to be better than pre-pandemic

levels so the nice part about it is it's a free cash flow machine, very good for investors, because they'll probably increase their dividend, which is already indicative of about 2.4%, as well as do some share buybacks what's interesting about the stock, given the fact it's underperformed the sector, and number one constituent in the xli, go out and buy the stock today around $99 and then what you want to do, is you want to sell a call against it, let time be on your side and go out to may. and you can sell that may 19th, 2023 105 call for about $1.65. you're going to get the dividend payments, and get this nice options premium of just under 1.8% and then you can let the decay happen, and let the stock try to rebound that total of 8% that

it's been underperforming, the entire sector. now, why we chose the may strike at 105 is because that's the highest open interest for the stock. >> all right, kevin, thanks. kevin kelly. mike, what's your take on the trade? >> yeah, i think we're getting to the upper end of the valuation range for this thing there is war in europe, tensions in asia, we ar looking at topline growth, i do like the name, but i do also believe that the upside is probably a little bit limited. so i think the trade is a good one. >> carter? >> so interestingly while the stock is underperforming the industrial sector of which it's the largest weight at 5% it's the largest constituent in the aerospace subindustry group a part of the overall industrial at 20% and its relativ performance to the aerospace group is relative high, true bifurcation, a laggard within an entire sector but a leader

within its subsector and that's a good set-up. up next, your tweets and the final call >> announcer: "options action" is sponsored by thinkorswim, by td ameritrade. 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," we've got time for a tweet, one "options action" fan asks, can you recommend how to play american express? it has run up a lot. looking to play bearish bet. brian, what do you think >> yeah, this stock has run a lot, and earnings are april 21st, which happens to be, as i looked at it, the friday of expiration so if i'm going to buy a put play to the short side, i like the 170 strike probably going to use an option after the april 21st date in case the earnings date moves that's expected earnings, not concrete just yet. that can affect option prices. i can play a little bit longer, maybe a may option or something like that to the downside in the april and beyond 170 strike put i'm a buyer. >> all right, let's get to the final call now carter, braxton worth. >> two big health care names so bad they're good, j&j playing for a bounce, pfizer as well.

>> brian stutland. >> owens corning, lots of premium, sell put to the downside, 95 strike in august. >> dr. khouw. >> chinese stocks are cheap. i recommend hedging with put spreads like those we saw earlier this week. >> that does it for us stay tuned, though, cnbc special "taking stock" starts right now. hi, my name is ty young and i'm the founder of ty j. young wealth management, and our firm has thousands of clients in all 50 states, and we manage over $1,000,000,000 in assets. and i say that to say this. we have been working with people just like you