Floor and heres a hint. Were going to turn it on were going to bring you the power well give you the trade. Its time to risk less and make more the action begins right now. Lets get right to it. Rates have been on a tear this month. The yield in the u. S. Hitting the highest level since july sending bond rates tumbling. Get right in the money right now. Its exciting that weve had this unprecedented gdp growth in q3 who knows . There should be no reason why rates should not be able to rally with a 3 economy, right you all agree with that . For a lot of purposes i would say im being a little facetious. One quarter of 3 growth does not make analyzed 3 growth. We were thinking of what a quick rise would be as we go into qt. Were going to get a third in december the treasury yield is a little bit low. For all intents in purposes it seems range bound. One thing bears will receive is if they pull back. If we know janet yellen is on the hot seat here. I suspect we get this push and pull between dovish the fed Balance Sheet is one of the levers that they have. We also have global levers in play that yellen does not control. The fact is that even as our own Central Bank Begins to tighten, that is not really the policy anywhere else on earth and money flows very easily. But its changing though, mike sthant one of the stories . We went from dovish Central Banks all over the world and we were starting to tighten and now it seems everyone is falling in line. The narrative has changed think about where we were in the start of the year. The consensus is 3 , 4 . 22, 23 thats the big subject carter, you say the rates are about to stack up . I think so. I think theyre going to come off here weve just moved up. Thats a big drop. You see the chart. 10 year yield. One thing we could do is the g following. It has lived within this channel all year theres a lot of symmetry between the order of magnitude and the duration of the counter trend move starters these are all the moves weve had, one, two, three, four, five look how similar 25 basis points, 32, 26, 29, 34. What about duration. Number of sessions up two weeks, eight two weeks 12, three weeks 17, three weeks two to three weeks all between 25 and 35 basis points im not sure things change lets say it does press on a little bit rates are low. Im not sure its enough to change the back drop for banks and all of that. In any events, im going to make a bet the utilities can bounce here two ways i would draw the line one, kind of come back to support. Two, that were on this trend line either way i think you have a chance of after this 5, 6 sell offwhere its a bounce a bounce, mike. What do you think . Im going to always go along with carter or most of the times ill go along with carter. One of the nice things about trading things like xlu, its one of the places where options are really, really cheap when they are extremely inexpensive, if youre trying to make a directional bet, a trendtype trade, it sets up nicely for that. I think this is one of those cases. I think we can talk about it a little bit more. I was looking out to january on the 53 call. You can spend 1. 45. Those are at the money calls youre risking a little bit less than 3 . The lslu to make that bet youre not risking a great deal. One thing that was interesting is thats clearly the down trend so could you have a pull back in the tenyear yield would they rush back into the slu or something its acted pretty well its an expensive sector we have this conversation between growth versus value. I guess where i shake out on the whole rate trade, on your trade though, it makes sense options are cheap and it does set up technically and that sort of thing i would say if the market and the economy and all the stuff that we talk about every night on this desk are as good as we think it is, its all happening around the world at the same time, the stock market should be able to go up with rising rates. We have had nothing. Whats wrong here. Why is it that rates cant go up Everything Else is saying all systems go. One thing i would throw out, that is that xlu is not like trading tlt. Thats a fixed income. Xlu trades like fixed income this isnt these are utility companies. Many times you have regulations but earnings can rise in the sector and i think thats an important thing to remember, that in that way its probably more like trading in inflation adjusted instrument rather than fixed income. Look how much staples have been which are tied to this. Staples have risks associated with the operating business. Some of those businesses are under real pressure for structural the rates will move higher and the xlu will not bounce or in fact rates dont do much and the xlu is over. Telecom, this is in a dividend yielding basket. It has to do with businesses, markets, tmvz is acting quite differently as well. One final thing i would say where utilities are concerned, were thinking about the ability for them to maximize generation, number one, storage for batteries. Plus the fact that you have electric cars. That is different than those other things. Now to stocks that have been on fire. The chips, the sme semiconductor surging 30 and the rally just keeps getting hotter micron, applied materials, theyre up double digits are any of the names still a buy . Second try will be a charm. Last week i picked the one Semiconductor Stock that closed down i want to look at intel. I think theres a lot of things going for this company now i think theyve been digesting a couple of really big things theyve bought aletra, and they bought Autonomous Car mobileye. There were a couple of ai deals in between that. I think this is a company that is pretty dead set on not missing the next Big Technology trends when i look at intel, we have a couple of charts this is the five year. The 52week high was made at 38. 45 thats a multiyear high look at this thing this is one of the tech stocks carters been talking about this on fast money on the last couple of occasions. It really has a ton of room to go lastly, thing trades at about 12. 50 well below market multip multiple my bullish idea is if you can ever get something high single digits, cost cuttings, youre expecting a 3 earnings number this could be rerated back to 13, 14 times you have a 45, 46 stock i think investors will start thinking about that. Options prices are cheap im looking at their earnings event. On october 26th. I want to look at october 27th weekly options i want to target this event. Im long this stock. Im considering this a stock Replacement Technology options prices are cheap when it was trading at 38. 05, you can buy the 38 calls for 85 cents. If you do the math right there, thats about 2. 2 of the stock prices stock has rallied 10 . Its at that massive resistance level. If there is a beat in re s, its going higher i think youre seeing low 40s. We rarely talk about the ability to rent options for nothing. This is one of those circumstances. These are not going to decay the way an option like this normally would. Effectively, if the stock rallies, you will have an opportunity to monetize with minimal decay in the meantime. If you dont get the move, you can make the decision if you want to stay long. Its poised thats what that is, those precise levels intel was so not liked as this was all going on because it was not mna related and all of that. We know that other large cap sort of mature tech names have all been quite good. Microsoft, oracle, until the recent setback quite good. I would think this will ultimately break out, catch up and will do what the chart implies. It was probably because of the earnings that you are looking at. When you say ultimately theyll break out. Do you think the october catalyst is the ultimate time line. Its very precise its not only the past over the past say year it goes back to 2014 all in the context of that huge base so that even lets say even if it doesnt work, youve got limited down side presumptively with a setup its kind of a heads you win, tails you win. I want to leave you with this last idea. This stock moves 3 1 2 . That call should be worth 3 1 2 of the stock price the day before they announce, all right . Right now its only 1. 60. You can think of how little decay youre likely to experience unless some material bit of news comes up if it does, youll be glad you own options. Options, 80, 85 cents depending where it was trading when i placed it on october 25th, the day before earning, i think the at the money with the call and the quick premium will be about 1. 40, 1. 50. You get a free look at this. Real quickly to answer your question about the exact date, i dont know what the numbers are, okay of course. Im telling you this, if they have a beat in raise this stock is up 5 you said it yourself, the stocks, semiconductor etf is up 30 . The stock is the second largest name in that group it will play some very quick catchup. Gives you a little dividend, too, which is unlike most semis. 28 . For everything options action check out our website optionsaction. Cnbc. Com rumor has it mike ko reads it every night before bed why not you . Heres whats coming up next. Heres the market and heres your portfolio and well give you the stock that will catch you up. Plus, calling all options actions fans. Reach into your pocket, grab your phone and tweet us your question optionsaction. If its nice, well answer it on air when options action returns. Logical i think its terrific. Your kids go to college and you start trading. Yeah, 5 years already. 5 years, hmm. You ever call your broker for help . Once, when volatility spiked. And . By the time they got me an answer, it was too late. Td ameritrades elite service team can handle your toughest questions right away with volatility, its all about your risk distribution. Good to know. Thanks, mike. We got your back kate. Does he do that all the time . Oh yeah, sometimes he pops out of the couch. Help from real traders. Only with td ameritrade. Witness katy perry. Witness katy perry become a legal witness. Witness katy perry and left shark. Or a card shark. Grandma . Witness katy perry work. Witness katy perry firework. Witness katy perry swish. Witness katy perry. Aaaaaaw look at that dog katy perry with music videos and behind the scenes footage, xfinity lets you witness all things me. Well, itsonce again. Eason yeah. Lot of Tech Companies are reporting today. And, hows it looking . I dont know. Theres so many opinions out there, its hard to make sense of it all. Well, victor, do you have something for him . Check this out. Td ameritrade aggregates thousands of earnings estimates into a single data point. That way you can keep your eyes on the big picture. Huh. Feel better . Much better. Yeah, me too. Wow, you really did a number on this thing. Sorry about that. Thats alright. I got a box of em. Thousands of opinions. One estimate. The earnings tool from td ameritrade. Welcome back to options action. The dow saw its best threequarters since 2013. It was a dream team of boeing, apple, mcdonalds, cat, if you missed the rally are there any other names you can play catch up with. Carters got some clues. Looking at home depot obviously its making alltime highs, but its really lagged. Certain key aggregates of which it is a big part few charts to that end home depot which is here compared to the Dow Jones Industrial average over the past 18 months what we see quite clearly is, while it might not seem like a lot, still, youre talking about under performance at this point. And i think thats going to be sort of narrow home depot versus the dow. Heres another way to look at it home depot versus the s p, albeit barely but still, too, lagged lets go again here is the s p 500 pure growth, etf. Growth stock it is wide this as well. I think theres an opportunity here lets look at the chart. A little bit of data this refers to what were talking about on the chart ready . Im not sure were moving. You saw that lets go forward again here we go all right. Here it is got some lines coming. Thats a heck of a set thats a breakout from the welldefined tops. Thats an opportunity. Close at 163 today take a look at where the stock is in relation to the fiveyear channel. It has been just in the middle so where we can get back towards the highs, which i think is every distinct possibility, youve got 10, 12, 15 points its probably the earnings that does it. I want to be long in it. All right so, mike, whats your trade on hd im trying to take advantage actually of some of the same dynamics that dan has in his intel trade. Id like to be long in the actions that capture in november earnings event. I have a feeling whatever happens in the meantime is grad actual theyve probably gotten a little bit of a bounce. Theyre expecting a short oneterm pop so specifically what im looking at is the 1. 65 octoberjanuary call spread. I could buy the january 1. 65 for 4. 65 and sell it at 1. 05 im getting long that daily call taking advantage of the fact i dont think theres a lot in the preearnings options. Do you like the chart the chart is a beautiful breakout it was one of the strongest names in the year and a half of this rally it bucked a lot of trends when we saw things in 2016. Prior leaders fell it never fell, it kept on going. I agree with your technical trade. I love calendars hes selling the shorter and hes setting up to own the longer dated one the only thing with a stock with momentum like this, are you getting too cute with selling the october 1. 65. He said 12, 15 points. To me, if youre playing for that breakout and you believe in the charts, you like the fundamental setup into november, holiday selling season, then i think you just buy a january call spread or Something Like that and you sit with it rather than getting too cute. You wont lose money. No, i mean, even more than that probably because you can think about that 1. 65 strike as still january, im going to have 3 bucks worth of premium. We kick ourselves all the time get all of the inputs right and the trade structure wrong. Im thinking it is a little tight. Its absolutely fair point that if you were looking to get a little bit more leverage to the up side, 1 for the october calls is not a great deal for the 165 stock well be very clear about that these options like so many of them are cheap options are cheap for a good reason weve had very low volatility. Between this and lowes, this is the Better Company five times in earnings. Yes, i think there will probably be earnings something fundamental that resolved it. Up next, charts, stocks surging. Dan says one of those names right there could go even higher plus, if youve got a question, send it to us optionsaction if nice, well answer it later in the show. More options action ahead. G. G. Yeah, 5 years already. 5 years, hmm. You ever call your broker for help . Once, when volatility spiked. And . By the time they got me an answer, it was too late. Td ameritrades elite service team can handle your toughest questions right away with volatility, its all about your risk distribution. Good to know. Thanks, mike. We got your back kate. Does he do that all the time . Oh yeah, sometimes he pops out of the couch. Help from real traders. Only with td ameritrade. Well, itsonce again. Eason yeah. Lot of Tech Companies are reporting today. And, hows it looking . I dont know. Theres so many opinions out there, its hard to make sense of it all. Well, victor, do you have something for him . Check this out. Td ameritrade aggregates thousands of earnings estimates into a single data point. That way you can keep your eyes on the big picture. Huh. Feel better . Much better. Yeah, me too. Wow, you really did a number on this thing. Sorry about that. Thats alright. I got a box of em. Thousands of opinions. One estimate. The earnings tool from td ameritrade. Welcome back to options action. Time to take a look back at our open trade dan made a bet that American Express was going to break out. To me i think this thing plays some catch up. Implied volatility the price of options is very cheap. You want to target that earnings event in mid october this is an easy one. With the vol as low as it is look out, when the stock was trading at 86. 80, you could buy the october 87 and a half call paying 1. 40. It looks like dans bet worked out since the time of the trade American Express shares are up 4 just hit a 52week high today. Dan, what is your next move . This is how you trade the options. You dont have to read a book to learn how to trade the options. You should. Ive got one. Yeah. Those cost 1. 40 the stock is at 90. 30 thats worth 3. 40. You roll them up take profits on the 87 and a half strike. You look out, you say you originally paid 1. 40 you say make 2 in profits the october 91 calls are offered at 1. 40, okay id buy those and id have a break even at 92. 40 i was targeting a move back to 95 i think thats how you do it roll up that premium youve locked in you cant lose you can lose the new premium but you cant lose from the initial trade and youre booking 2. Also, two weeks ago ko and carter said mcdonalds run was done my guess is that were just going to check back, check back, check back the trend so i want to fade mcdonalds if im wrong, i want to take profits. If im a short seller you get a nice 5 to 8 selloff december 1. 55, 1. 45 wide put spread thats a 10 wide put spread you can spend 2. 50 for that. Its been a bit of a roller coaster ride mcdonalds fell more than 2 and recovered some of the losses what do you say . Stick with it in the sense that its done nothing and the market is surging which is massive underperformance thats a great setup for further trouble. We have plenty of time here this thing has almost no decay id stay with it. Up next, tweets and the final call from the options pits i think its terrific. Your kids go to college and you start trading. Yeah, 5 years already. 5 years, hmm. You ever call your broker for help . Once, when volatility spiked. And . By the time they got me an answer, it was too late. Td ameritrades elite service team can handle your toughest questions right away with volatility, its all about your risk distribution. Good to know. Thanks, mike. We got your back kate. Does he do that all the time . Oh yeah, sometimes he pops out of the couch. Help from real traders. Only with td ameritrade. Well, itsonce again. Eason yeah. Lot of Tech Companies are reporting today. And, hows it looking . I dont know. Theres so many opinions out there, its hard to make sense of it all. Well, victor, do you have something for him . Check this out. Td ameritrade aggregates thousands of earnings estimates into a single data point. That way you can keep your eyes on the big picture. Huh. Feel better . Much better. Yeah, me too. Wow, you really did a number on this thing. Sorry about that. Thats alright. I got a box of em. Thousands of opinions. One estimate. The earnings tool from td ameritrade. Time for tweets. First one is from josh he asks, why would you use a debit spread versus a credit spread and vice versa, mike . If youre expecting a big move, options are cheap, you spend money. Thats a debit if youre expecting small moves and theyre expensive, credit spread how do you determine when to roll up or roll down in an active trade good question we kind of hit that with the American Express trade heres a situation where the call that you were long is in the money. Now im going to take some of those profits and roll it out of the money and define my risk. Time for the final call carter offensive and buy home depot. I want to be defensive and buy xlu. I like depot but i like the intel call ive got to say. Intel, this is important. Because you have to get october 27th weekly. Not the october regulars because earnings fall on the 26th. Looks like our time is expired. Im melissa lee. Thanks so much for watching. For more options action, check us out online. Well see you pack here next friday at 5 00 p. M. Eastern time dont go anywhere. Mad money starts right now ist for viviscal. You know that confidence you get when your hair feels good and looks great . You feel absolutely beautiful sadly, that confidence can be quickly shattered when your hair starts to show signs of thinning. Thinning can be the sad reality of overprocessing, overstyling, and aging for all hair types. What are the problem signs so many of us experience . Thinning, dryness, brittleness, breakage, frizzing, lack of luster, loss of bounce, and an inability to style. If these are issues youre dealing with,