Weekly Weekly’s 5.22.14

Retail earnings steal the show! I’m Angela Miles, covering weekly options that expire this Friday and some for next week. The long Memorial Holiday is coming up, which means time-decay for options premiums. So these are fast turn around trades.

I’m starting with Hewlett Packard. HPQ earning are expected today after the close. As the stock trades $32.50, upside call buyers emerged at the start of the trading session with traders purchasing calls at the 33 strike price. There were also some 30 put buyers. The HPQ 33 straddle ($2) implies around a 6% move either up or down off earnings.

Now onto those retailers reporting today…

Gap reports earnings after the close.  The stock is trading at  $40, there is light calling buy at the 41 strike. The straddle at the 41 strike trades at $1.85, pricing in a possible ~4.5% move.

GameStop also turns in results tonight.  There appears to be an interest in the straddle. Earlier today, someone was buying the straddle on GameStop and it’s expensive. The 37 straddle is bid at $3.20 (8% move) and I’m hearing spreads are wide. I’m anxious to see how this trade works out!

Footlocker reports earnings Friday morning making for a very quick weekly options trade. The FL 48 straddle at $3.40 predicts a 7% move in the shoe stock is possible.

Netflix has been active this week on news it’s expanding in Europe. The stock has had a big rally, up to $390. Enter the put buyers. Puts are active in multiple strikes. There’s a congregation around the 370 put strike. There’s light buying in the 400 strike calls. Traders are already positioning in puts for next week’s Weeklys options as well, at the 360 and 365 strikes.

Apple trades above $600 this week. And, it’s generating call buyers at the 605 and 607 strikes. Options expiring in June are attracting AAPL call buyers at 620 and 630 strikes. Implied volatility is very low this week and next week in the Apple Weeklys.

In the early going on SPX was all about out-of-the-money puts at the 1,860, 1,870 and 1,875 strikes.

One other mention:  A new name has been added to the  list of available Weeklys: NQ Mobile (NQ).  Send us your questions.  AM