mike khouw has a sequel that might be better than the original get less to make more. options action starts now. >> a smoking hot stock and a twist on the consumers staple. carter and mike are laying out a way to play the name if you think this tobacco stock is going to burn higher carter, what are you looking at? >> smoking, burn higher, we have it all here. let's go right to the charts it will be similar and these are weekly bars that puts in context the high almost five years ago at 120plus we have broken the downtrend is it a head and shoulders bottom which is another way to characterize a reversal formation. it is, the next chart. it doesn't matter what you call it the sequencing is some of the most time tested and markets look at the next chart same timeframe what we have here is basically a very symmetrical orderly, bottoming out process and the presumption is it will return to its all-time high. philip morris -- where did it close? >> the all-time high was 103, 104. i think you have an upside and this is important. this is a two-month performance. relative performance is one of the most important factors in investing. look at philip morris the past two

carter worth and mike khouw tackle that. >>> he spotted a new technical pattern in the old-school tech titan. >>> plus a look back on a specific bank trade before the barrage begins "options action" starts right now. >>> welcome, gentlemen we begin with the first of two opposing trade on the consumers themselves caught between covid. carter worth will take us through the big picture and part one. carter >> you bet what we're going to look at first is an etf, the xrt, that captures a broad swath of retailers. small once like footlocker and gap. it tells a pure story. let's look at the first chart. closed out today at 87.18. and no judgments, no drawings, let's draw some lines. next chart one thing one could see, that's what my eye sees, a big topping out or rolling over. the next chart, you can draw the lines this way could you call that a double top? you could. you can. look at the next chart is it a well-defined trend and break in trend it is. put a few of them together a final chart. we have a double top we have a break in trend, and we have very poor relative performance to the s&p,

. >> this is quite a call carter mike, do you have the fundamental story to back this up >> i think what people take a look at the price action here and obviously the big run that we've had oaf the course of the last couple of years, there would be reasons why some investors might be reticent to either get long or to stay long semi conductors. right now as a group i think the index is trading around 32, 33 times earnings that's well above average. here is the thing. we all know that there's been a chip shortage. we know there's high demand. we know that that demand is going to persist we know the chip makers have pricing power. take a look at some of the largest constituent stocks like taiwan semi announcing they will have 10 to 20% year on year price increases. this is the kind of thing that demonstrates that this is a group that's in a very strong position if we're actually going to try to make a bullish case for any sector, i think it's reasonable to expect the business for these guys going forward will be quite good carter pointed out we had this big bump recently. essentially what's

, you wrap it up >> xrt put spreads >> all right, carter, mikehing. we'll be back next week with more "options action." don't go anywhere, jim cramer's "mad money" starts right now - [presenter] the following is a presentation sponsored by trusted luminess. - i have a lot of problem spots, redness, fine lines, dark spots. and now with the breeze, all that's changed. the breeze advanced foundation is amazing. it gives you skincare and makeup all in one. it's like a thin veil, but it has extraordinary coverage. at my age, all the other makeups made me look older. it was uneven, you'd have to layer them yourself. it never quite came out the way i wanted it to. the great thing about the breeze is it does your blending for you. i love the way the luminess smooths out

staple for some, shares of philip morris starting the year strong, up nearly 9% and carter and mike,you think this tobacco stock is going to burn higher what are you looking at? >> smoking, burn higher, we've got it all here. let's go to the charts the charts will be similar but different annotations. the first one these a weekly bars and puts in context the high almost 5 years ago, 2017 up there at 120 thplus so one way to draw the line we have broken the down trend next chart is a head and shoulders bottom which is another way to characterize the formation. it is. the next chart it doesn't matter what you call it, these sequences are some of the most time-tested in markets what we have here is basically a very symmetrical orderly bottoming out process, and the presumption is the stock is going to return to or close to its all-time high. philip morris closed today at -- actually i'm not remembering but the all-time high was 123 and i think it went out today 103, 104. i think you've got up side the final slide is a table, but this is important. this is two-month performance. relative

. >>> carter, mike, tony, thank you very much. thanks to all of you for watching don't go anywhere, >>> my mission is simple to make you money. i'm here to level the player field for all investors. there's always a bull market somewhere. i promise to help you find it. "mad money" starts now >>> hey, i'm cramer. welcome to "mad money. i'm trying to make you some money. call me or tweet me. searching for jobs, you know that wages will be going lower how about if there's 11 million jobs looking for workers not only are wages headed higher, so are interest rates. that's what we learn from today's employment report. fed will have to move quickly to stamp out inflation before it really gets out of control if rates are headed higher, that means the stock market is probably out of control. the dow dipped five points climb 4.1% and the nasdaq laid an egg it lost another 9.6% man, this is bad i've been saying since november when the fed started tightening, the conceptual companies get hammer the tangible companies with real earnings start g

calls, carter, you first. >> well, victoria's secret it's a great place to be. >> all right that sounds good tony, you? >> kinder morgan earnings buy a put vertical spread. >> all right and mikek at victoria's secret, the high options premiums combined with the low valuation, i think a call spread risk reversal is the way to play carter's play. >> that does it for us see you next friday. don't go anywhere, "fast money's" special edition is right now. t, that's not a weekend trip. fifteen minutes until we board. oh yeah, we gotta take off. you downloaded the td ameritrade mobile app so you can quickly check the markets? yeah, actually i'm taking one last look at my dashboard before we board. excellent. and you have thinkorswim mobile- -so i can finish analyzing the risk on this position. you two are all set. have a great flight. thanks. we'll see ya. ah, they're getting so smart. choose the app that fits your investing style. ♪♪ ♪♪ ♪♪ ♪♪ - [presenter] the following is a paid program for carshield that will show you how to save big money on your auto repair bills. today's show is hosted by tv's "overhaulin'" adrienne janic, and features appearances by former ghostbuster, ernie

to the covid low, but now, having almost tripled from that level, it's down 50% >> mike, what is the paid here carter has laid out the performance of the stock >> you pointed out it's -- but actually there's a lot of etfs that have relatively consequence trailed hold ings the conversations are even bigger, but i think the big problem you have here is that cathie wood's strategy of buying the growing highest multiple, most exciting companies is a risky strategy in a market environment when you begin to see a focus on real earnings. >> i believe that that's essentially the market we find ourselves in you would think after a decline of almost 50%, some of these things are cheap, but they're really aren't. what we have seen is aggressive valuations that basically push people into higher risk. the thing is shorting something like arkk has a risk buying puts is a way to get some downside exposure, but implied volatility is approximately 50%. that's roughly double what the current implied volatility in the qqq is so i think what you want to do, if you're interested in buying options, is looking for some to

carter worth and mike khouw ck

. >> thank you, carter for that. mike, what is the trane then >> so this is an interesting one. alphabet, because i think this would probably be one of my favorite stocks under normal circumstances for the full year. i mean, this thing is trading at less than 23 times full year estimated earnings, cheaper than the market if you look at it x cash, it is probably about 21 times. and you compare it to other stocks that other people seem to like although that are performing very weakly like amazon which is a comparably valued company that is probably going to make about 80% less in terms of the earnings and over the course of the next five years or so, maybe 260 billion versus 500 billion in the aggregate over the next five years for alphabet over amazon so about 80% more than amazon. but obviously nothing seems to be performing all that well in this environment so if you own this stock but you're concerned, one thing you could do is consider a hedge and the hedge i was looking at, because implied volatility is for almost everything have gone up because of basically what we're seein

mike: a couple of ronald reagan references, how do you respond, david? >> this is far closer to 1978 as president carterterm elections and it was after that that you had ted kennedy who decided it was time for him to take a challenge in the primary in the 1980 primary to jimmy carter and so if you're looking at historical analogy, we are far closer to 1978 than we were to 1981. >> all right, little history lesson in here today. david, laura, have a wonderful day. >> thanks, mike. mike: millions under winter weather alerts as large storm rages in the east coast bringing ice and freezing rain. the latest forecast coming up. ♪ ♪ to♪ ert liberty, liberty ♪ only pay for what you need. ♪ liberty, liberty, liberty, liberty ♪ ♪ ♪making your way in the world today♪ ♪takes everything you've got♪ ♪ ♪taking a break from all your worries ♪ ♪sure would help a lot ♪ ♪wouldn't you like to get away? ♪ ♪ ♪ sometimes you want to go ♪ ♪where everybody knows your name ♪ ♪ ♪and they're always glad you came ♪ (jackie) i've made progress with my mental health. ♪ so when i started having unintentional body movements called tard

mike. especially if you look at the search and the youtube monetization pathway that they have, there is not a lot to hate about this particular stock. but the charts are clear as carter shows you remember this was a thousand dollar stock just two years agoch an since it broke out above the 2600 level in june it is completing the topping formation and you're at risk of breaking that. and i think downsize here is risk of about $2,000, so 25% down side risk so for investors in this stock, looking at a hedge, makes a lot of sense. you're taking about 2.3% of the stock's value to protect yourself about 25% downside. that makes sense for speculators, if you're trying to bet on a directional bet here, the fak that mike is able to take a trade on google or alphabet, that only cost you half a share that type of trade that you want to use options for to leverage your capital so you could take a speculative bet. but the stock is trading at 21 times next year's earnings when you look at cash it is cheap relative to itself and sector so it is reasonable for shareholders to hold on to this stock and look for a hedge. >> mike, last word on the trade? >> yeah. i mean this is one of

mike: positive thinking, greg palcock, thank you very much. joining me now california republican congressman foreign affairs committee derril issa. >> just like the end of the jimmy carter, we basically have open invitation for change in government. this is what happened to shaw of iran and in vietnam and afghanistan. the russians have a ticket that actually was invited during the president's one year anniversary to have and encouraging to them is like nazi germany's idea of helping germans in czechoslovakia. they took the whole country. >> i want to play for you a clip of the secretary of state on cnn today. >> we are building up our defense and building up our deterrence to make sure that if it doesn't follow the diplomatic course, if it renewed aggression, facing significant consequences. mike: is that enough? >> closer to the capital than, in fact, downtown san diego from camp penalton, this is a massive build-up, it's clear that reagan's that he never saw war, started because of too much strength on behalf of the united states but rather weakness. our policy peace through strength has been reversed. it is clear that russia will take action, get what they want or at

carter with his grandpa t in north carolina. denise, beth, diane, kathy, chris, and joan in ohio. looking good in the jammies. joe, christy, margie, mikelazinsky sisters in delaware. >>> we begin a new year together, and we'll see you back here next week on "sunday today". >>> good morning. it's sunday, january 2nd, 7:00 on the dot. as we take a gorgeous look outside, the sun is rising on the bay bridge on a chilly morning. you can see the water really moving there. thank you so much for starting your morning with us. i am kira klapper. meteorologist, rob mayeda, is in for vianey, and he joins us for another frigid microclimate alert. >> we do have the temperatures in the 20s and 30s around the bay area. san francisco, a mild location at 41 degrees. san josÉ

mike pence to overturn the 2020 election. eastman taught law at chapman university at the time and was fighting the january 6th committee's efforts to see his university emails. but judge david carter then if he wants to, offer case-by-case objections if he wants to assert some privilege over some of the documents. judge carter writing the court expects the parties will work together with the urgency this case requires. our reporters are back with us. dana bash, katlyn points out the importance of the committee getting more documents. they are the clearest statements yet on how much eastman was doing on trump's behalf. rather than on his own initiative in the days leading up to january 6th. the committee is trying to piece together a timeline how involved was the former president in trying to, a, object to the election and block the election, then overturn the election and then january 6th. this is part of the puzzle. >> absolutely. i agree. kaitlan is one of our best reporters. and the fact that donald trump did not and does not text, he does not email, it doesn't necessarily mean that there won't be a paper trail on what he wanted which is the whole goal in getting these emails f