and mike khouw and carter wirth says you should be buying too.lling all "options action" fans, reach into your pocket, grab your phone and tweet us your question at "options action." if it's nice, we'll answer on air when "options action" returns. "options action" is sponsored by "options action" is sponsored by think or swim by td ameritrade sounds like a case of analysis paralysis. is there a cure? td ameritrade's trade desk. they can help gut check your strategies and answer all your toughest questions. sounds perfect. see, your stress level was here and i got you down t i've done my job. call for a strategy gut check with td ameritrade. ♪ (indistthat was awful.tering) why are you so good at this? had a coach in high school. really helped me up my game. i had a coach. math. ooh. so, why don't traders have coaches? who says they don't? coach mcadoo! you know, at td ameritrade, we offer free access to coaches and a full education curriculum- just to help you improve your skills. boom! mad skills. education to take your trading to the next level.

everybody knows it >> pretty dire prognostication mike khouw in san francisco. how can traders buy protection here. >> yeah, i mean, under normal circumstances maybe when we have seen these kind of pullbacks -- and carter pointed out we have seen several pullbacks of magnitude almost as great over the course of the bull market we have seen. one of the things that didn't accompany that in the prior declines we have seen in the last ten years was sort of, you know, all of the discussion that we have, you know, are we in a ber market are we in a bear market we were hearing the conversation you know formally the qs in a bear market if we use the 20% drawdown as the threshold. so we are looking at ways we can either press a bearish bet or hedge against further declines in the portfolios. we do have elevated options premiums we have been talking about that for weeks now. i think you still want to take a look at things like put spreads on the broad indices like this i was looking at the qqq february 147/131 put spread. you could spend about $4.5 to buy that paying $7 f

but mike khouw and carter wirth they are due for a bounce. they give us the trade plus. >> i'm in love i'm in love and i don't care who knows it >> options traders long the banks this week. and one name in particular they see soaring in the new year. we'll tell what you that is. and later. >> i've got the deal of a lifetime for you do you have a minute >> the recent selloff has stocks trading at a major discount. and there is one dow stock carter says is a major buying opportunity right now. he'll break it down. it's time to risk less and make more the action begins now. >>> let's get right to it because it has been the ultimate battle between bulls and bears as the major indices close out a wild week. the s&p down wall street clawing their way out of bear market territory up around 3%. even the russell 2000 which has gotten hit hard in the selloff eeking out gains and the chart master says the small caps could be setting up for a big are bounce he is at the plasma. hey carter >> we know there is beta in small caps relative to large caps we n

mike khouw for more "options action" check out the full shofray:3w id 50 p.m. eastern time. p.m.xt, final trades. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated. step-by-step options trading support from td ameritrade >>> time for final trades. go around the horn pete. >> i think the exchanges the place to be. cboe, baby. >> brian kelly. >> strong dollar is not that great for emerging markets you sell eem. >> grasso. stay accounts i said xlu i'm sticking with that xlu. buyer beware if the market goes down mot bullet proof. >> a very important "mad money" coming up in 30 seconds. >> the micron guy on. >> the micron guy. the snippets of that. >> eli lilly. >> and this was

and mike khouw and carter wirth say the next retail shoe is about to drop. they'll lay it out

if you are worried it could get worse mike khouw has a why to buy plunge protection plus. >> i love gold. >> as stocks tank, options traders are running for cover in gold and the chart master says it coulbrk

but mike khouw and carter wirth they are due for a bounce. they give us the trade plus. i'm in love and i don't care who knows it. are loving the banks this week there's one name in particular they see soaring in the new year we'll tell you what that is. an

and mike khouw and carter wirth say the next retail shoe is about to drop. they'll lay it

but if you missed the rally mike khouw has a way to get in. and retail is getting wrecked ahead of the holidays. >> how horrible our christmas will be. >> that's exactly what carter werth says he has the charts to prove it it's time to risk less and make more the action begins now. >>> and we start with the markets as the selloff went from bad to worse this week the s&p 500 falling nearly 5% straight back to the october/november lows. now tracking for the worst quarter in seven years as the broader markets plunge investors run for cover in the so-called safety sectors utilities, reits, staple all higher but dan nathan says there is danger in one of the groups. let's get in the money looking at the utilities etf. >> yes today was trading at a new 52-week high one of the things interesting we have a one-year chart it was tracking the performance of the s&p most of the year and there's been a bit of a divergence over the last couple of months you see the orange line where it's gone up to the right. it's gone down and to the right. to me that does

but if you missed the rally mike khouw has a way to get in. and dsh reta

and mike khouw and carter wirth say the next retail shoe is about to drop. they'll lay it out and -- >> broken down piece of junk. >> transports are nearing bear market but dan nathan says one name in the group could be so bad it's good it's time to risk less and make more the action begins now. ♪ >> we start with the transports bear market down 18% from the high planes trains and annihilation for the group this month check out hard hit names fedex and american airlines down 20% ups, jb hunt, norfolk southern all getting crushed. with fedex earnings out next week could it deliver a bounce dan makes a contrarian call and today. fedex is down 20% since that december 3rd post g20 gap. remember we had the trade deal with china and the stock market gapped up. we have sold off since fedex has been down about 21% since then most of the 25% decline on the year the options market is implying about a 5.5% move in either direction next woke. that is rich to its average over the last four quarters of 3.75%. moved on average the last ten years about 3.5% i think given in

but mike khouw and carter wirth they are due for a bounce.e trade plus. >> i'm no love i'm in love and i don't care who knows it. >> options traders lochg the banks this week. and one name in particular they see soaring in the new year. we'll tell what you that is.

mike khouw. >> i'm not a gold bug but i like gold here.re the way to play it merry christmas, everybody. >> carter. >> i think from time to time you could be a gold bug so long gld and short qqq. >> dan. >> i think the theme is find some cheap vol and put it on january could be ugly but don't press things on a holiday week and happy holidays, everybody. >> and that does it for us here on "options action." see you back here next friday at 5:30 eastern time. merry christmas, everybody "mad money" starts next. the following program is a paid commercial presentation for total gym fitness. [music] everybody work out. feel the energy. build a better body. the best you can be. another body easy as 123. oh. ahh. better body as easy as 123 with total gym. i feel fabulous

if you are worried it could get worse mike khouw has a why to buy plunge protection plus. >> i love goldank, options traders are running for cover in gold and th

one trader made a huge bet the mike khouw breaks it down in san francisco. hey, mike. >> hi, there, tlt traded well over the daily options volume today, that's notable because it normally trades about 90,000 contracts. totally trading 36,000 contracts. and its seems like there was hedging activity, speculation things could get worse we saw that here too the january 121-127 call spread in tlt traded over 20,000 for 50 cents. the speculator could betting it could rice or the long call rate fall i think this combined with some of the other trades we saw indicate that people were taking advantage of something guy mentioned a little bit earlier, which is that options premiums didn't spike maybe as much as you would expect given the selloff today. they are trying to take advantage of that and get hedging in while they could. >> given the move today, mike, how high do you think the vix should have been >> well, you know, the way you can look at it is we look at how volatility is -- you can take whatever the current level is and divide that number by about 16 that te

. >> okay mike khouw in sand fibrin see you friday night. >> frustrate show. >> check out the full showction 5:30 p.m. eastern time friday. 2:00 p.m. mounte >> they don't have you on anymore guy. >> it's not 2:00 p.m. mounten. >> it was meant to be funny but tim had a comment that wasn't funny for the second time tonight he ruined -- ruined the showpy. >> mountain time very funny. mountain time. funny stuff folks. >> nearly 11% this woke. trading the highest level in years. do you know what the stock is? mystery chart. find out what's coming up. tonight on "mad money" jim breaks down why today's market action could mark a turning point for stocks you want to hear what jim has to say. at the top of the hour aayweilsee nasdaq market site aslws wl e you back after this i don't know what's going on. i've done all sorts of research, read earnings reports, looked at chart patterns. i've even built my own historic trading model. and you're still not sure if you want to make the trade? exactly. sounds like a case of analysis paralysis. is there a cure? td ameritrade's trade desk. they can help

we see a lot of that last night mike khouw talking about the protection on the downside in the triple qs. we see that every day but it's short in duration. >> the higher we go in week into the new year is the lower we go into you know january. >> but there is trade in between. >> year without a santa clause. >> dan is a die hard. >> no micer. >> see what i did there. >> coming up, talk about bad energy, crude crashing 4% and taking the energy sector down. every stock in that sector sitting in bear market is this group a no touch speaking bear markets. nasdaq entering one. down 20 from the highs a top technician weighs np check out nike jumping after hours. the conference call happening now. live from times square in new york city. much more "fast money" right after this you always pay your insurance on time. tap one little bumper and up go your rates. what good is having insurance if you get punished for using it? news flash: nobody's perfect. for drivers with accident forgiveness, liberty mutual won't raise your rates due to your first accident. switch and you could save $782 on home

mike khouw joins us from san francisco with the "options action." >> exxonmobil, the largest of the bigrated oil companies saw about two times the call versus put volume today. and that activity was largely the result of purchases of the january 69-783 one by two call spread i saw 15 by 3,000 trading. they're buying the 69 strike call selling two of the 72 strike calls against it. my guess is this is likely what we call a stock recovery strategy so often times you own a stock, you have seen a sharp decline in it you look to boost the near-term returns you can buy a one by two call spread gichg you gains from 69 up to the 73 strike they sold that would represent about pennsylvania 4 to 8% increase over the course of the next couple of weeks in exon if it plays out. the nice thing is they are not risking a great deal to the downside in the event that oil weakness continues >> do you think we need to see crude rally or continue the gains in order for the stocks to find legs, mike? >> yeah, i do. especially the integrated plays. because of course you know what are the big timed oil companie

in the options market one trader made a million dollar bet that the pain will continue mike khouw joins us now to break down the "options action." t bone t bone >> how are you, joe? we did see it in the financials. what i was looking at was the kre. it traded well over two times the daily put volume in a large trade that we saw. it was a buy of the january 50/47 put spread someone paid over $1 so they're making a bearish bet it could drop 5 to 7% in just over five weeks from where it closed at the end of the day today. i point out that a lot of the constituent stocks in the regional banks also saw a significant options activity we saw a lot in regents financial, zion and bbt, all of them well above average. >> that was from last time, mike remember, nobody wants to be coco they named george, he wanted to be t bone. they called him coco, he didn't want to be coco. i'm giving you t bone. you don't want it? >> i'm good with whatever nickname you want to have. you're not on that often so we might as well try to keep it fun. i'm good. >> all right thank you, mike. for more "options action" c

let's bring in mike khouw to break it down. >> we did see double the average call volume in gm, general of the larger trades we saw was somebody rolling a previously bullish bet from the december 37 calls to the january 30 9 calls. they spent 1.40 for that they're hoping up above $40.40 by january expiration. that would be 5.5% higher than where the stock closed today this is a stock that's already been up 26%. for people who are thinking about pressing a bullish bet after that bounce on their last earnings, buying calls in january might seem like a good way to play it and that's where we saw most of the activity. >> michael in san francisco. for more "options action", that's friday 5:30 p.m. eastern tile up next, your vote on guy's fast pitch. >> here comes sell lecelene. >> big time. read earnings reports, looked at chart patterns. i've even built my own historic trading model. and you're still not sure if you want to make the trade? exactly. sounds like a case of analysis paralysis. is there a cure? td ameritrade's trade desk. they can help gut check your strategies and answer all yo

but if you missed the rally mike khouw has a way to get in.

but mike khouw and carter wirth they are due for a bounce.n't care who knows it >> options traders long the banks this week. and one name in particular they see soaring in the new year. we'll tell what you that is. and later. >> i've got the deal of