Lets get right to it. Despite the rate like and talk of deregulation, the financials were the worst performing sector this week. Down about a percent. Morgan stanley, bank of america. Is this just the beginning of a money breakdown . Im going to piggyback off something i saw earlier. A tour deforce about the bank stocks versus the broad market. And it got me thinking. Total shout out there. This group has paused. We know the reasons why they ran up. Obviously the hope of deregulation and higher interest rates. Ill let him talk about the relative performance. One the of issues that i think is first and foremost as the new administration is bogged down is the potential for dodd frank to change meaningfully. It is not particularly great. I think there may be some move toward midsize and Smaller Banks to get things going again in that capacity. But the big ones, jpmorgan, bank of america, citibank, they navy good news in the near term. One of the things i want to look at. Those are the year to date. Jp is up about 12 . It is really, really lagging. For this particular week, we cant ignore there was a real bid higher in bonds sending rates lower. As dan was pointing out, one of the issues for a bank is how do they make their money. What rate do you borrow at . Thats what the net is working. On the yield has flattened from december. It has steepened. Lately it has flattened. So thats not so good for banks. And we arent seeing significant commercial lending growth. Were seeing some disstregs in the auto lending space. The one bright spot for citispbs has been costco. Er they have a million new customers from that. But there are plenty of things that can create pressure for the financials here. All the things weve just covered are the problem. In the sense that, the first thing is expectations were too high. Of t interest ratesing nowhere. And to put these three numbers into perspective. S p 500 up 6. 5 . The sector financials, up 5. 5 . And regional banks, up 2. And this is a higher area are than the market. It is not doing well. The presumption is what will change that . Yeah. I want to look at city. Also the fact they report on april 13 before the opening. The options market, it is a ways out. But it is implying a 4. 5 move. That doesnt mean a whole heck of a lot. We have a oneyear chart. Its been the support level here i suspect as carter makes it around the seat. Maybe testing the low near february. So today, i want to look to the expiration where the stock was trading, paying a dollar for that. Buying one of the i am a puts. Selling one of the 55 puts at 15 cents. The risk is that dollar. You can make up to 4 between 59 and 55. 55 may be a little bit of an aggressive target but my play here is pretty simple. When these had go to guide for q2, theyre not going to have a lot of color as far as deregulation is concerned. And they wont have too much about the net interest mortgage. We havent had a heck of a lot happen. You had a pretty dovish raise. It is also the problem that it has been the laggard and the problem that it has the biggest global foot print. It is in areas being closed down. So not great. Do you like the trade . Yeah. I do like the trade. Dans point is a very good one. Dodd frank which is where theyre stuck right now. Everything that trump is doing is being pushed out. It looks like deregulation is getting pushed out if it happens at all. If people were baking in that good news and now they wont get it, that limits the upside. The one outlier is that the ceos can go on the Conference Call and talk about all the animal spirits that are happening within businesses that are creating more businesses. Im a bit skeptical of that. They dont look that way by their actions. If they cant get some policy instituted, they may start thinking twice about how theyll deploy their resources. Lets to go a stock that has gone from worst to first. Nike shares one of the best performing dows. It dropped nearly 20 this 2016 make go at this time worst in the dow last year. Rerngs next week. There could be more gains ahead. What do you see . All this flip flopping. Herring was so bad. Energy so good. And now so bad. And often, there is something to see. There are definite strategies. Nike sets up well to my eyes. Heres a what . 2011, 2017. The first thing that comes the mind is this. The second thing that comes to mind is this. Well, guess what. Were popping out of top of that formation. A nice setup. A period of massive underperform yabls for a large cap asset. Heres the day to day. Theres the line. Meaning whats going on here, weve moved above an important down trend line. Now, the question is, have been, where to . How much higher . I think ultimately you have the prospects of moving up toward 65. Or about 56. One of the things thats an opportunity is how bad this was. So this really tells you the story. This is the Consumer Discretionary sector of which nike is a big part. Youre faulk 1,100 base points up. So 2,000 base points a spread. Now would you say, how do we know youll catch up . It is already started. Lets take that. One week, nike versus the better. One month. Two months. You have a situation that, yeah. It was a laggard. Now this part here is better than this part here. So youre getting what you want. You have a very simple trade on nike. Heres the thing. Options are exceptionally cheap on nike. These are in the money. For just 2. 45. Youre spending 2. 15 in extrinsic premium. So under 4 of the colonel stock price. Right now it is implying a move of about 3. 7 . This is a situation where youre buying a stock trading at a market multiple. It has had very good top line growth. They are facing margin pressure and competition in the shoe business. So we are anticipating this. But probably 6 top line Revenue Growth year on year. Thats faster than s p 500. So to me this is the way to make a cautious but optimistic bullish bet. We had the ceo of adidas on earlier this week and he made it clear that he would go very aggressively after the north American Market ask compete around the world. Are you worried about it . I would say the bigger issue is the adjustment tax. When i look at that technical setup, i see what carter sees. And i see mikes trade makes a lot of sense. When it implits a 4 move over either direction, when you think how fast they are out to june. That makes a lot of sense. In the earnings disappointed, the stock is not breaking 50. It may get back to 54. If youre looking at the trade and you see what he sees, dont do the full position. Adidas has been a great performer. But thats not new news anymore. Theyve come is that gotten their age. Okay. Got a question. Last word. Very quickly, the street is expecting a small earnings decline consequentially versus last year. Even a match would be viewed very favorably. Got a question out there, send as you tweet. Check out our options action. While youre there, you can Chesapeake Bay o check out our super cool news letter. In the meantime heres whats coming up. When you want to make a call, be sure you have the right number. And be sure to spend any money. When the money is coming your way, be sure to not ask any questions. But somehow dan planning to make money on this long trade . Hey gary, what are you doing . Oh hey john, im connecting our brains so we can share our amazing trading knowledge. Thats a great idea, but why dont you just go to thinkorswims chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders . I know. Your brain told my brain before you told my face. Mmm, blueberry . Tap into the knowledge of other traders on thinkorswim. Only at Td Ameritrade. Hey nicole. Hey i just wanted to thank your support team for walking me through my First Options trade. We only do it for everyone gary. Well, i feel pretty smart. Well, were all about educating people on options strategies. Well, dont worry, i wont let this accomplishment go to my head. Im still the same old gary. Wait, you forgot your french dictionary. Oh, mucho gracias. Get help on options trading with thinkorswim, only at Td Ameritrade. President trumps trip to deregulate the Corporate America could lead to a spree of deal making. Julia boorstin has the story. Hey. The new fcc chair is much more relaxed attitude than his predecessor. The first sign, he decided not to review the at t time warnler merger and now there are plenty of reasons we could see other teleco deals. Er Wireless Companies struggle with rising costs is that price wars. We could see more immediate disease as streaming media provides differential. The marketplace right now is extremely competitive, delivering unparalleled to consumers. If you look at the last couple weeks, they are vigorously competing to give new or expanded unlimited data plans. Whats next, verizons Lowell Mcadam is looking for deals saying the conference in december will look for opportunities and put the money into an area where we think we can scale. It is critical to long term success. He has talked about the value in combining verizon with charter. We could see tmobile look at dish again. We could see the long discussed tmobile sprint merger emerge as an option again. They will not pretend to know more than the margaret. That has been a hot topic. If the deal does go through, how should you play it . Because of the thought maybe they could, maybe they would be acquired by a different sort of, a cable company. Im not so certain that you want to chase a stock over 170 from its 52week lows. It would let you participate and give you room on the down side if your long entry isnt great. Selling the put to help finance it. Why would you do that . Youre looking to basically have an alternative to stock that is really for a Risk Management sort of purpose. The other reason i would say is that this finance of the put sale, really what im trying to do is create a sale where im not paying premium out right now. If it rallies closer to the long calls, im going to have gains on a market to market basis. The last one is to get leverage for the move. So thats helping me buy these calls. With sprint, the stock was trading about 860 or so. I want to look at this seven level from november. The stock had a big turn around right after the election as obviously a lot of traders thought this was in play. It is a support level. You can look down to january, 2018. Sell it at 80 cents. Then you can pews to buy the january, 10, 15 call spread for 80 cents. It costs you nothing if you have the scenario where it is above 10. Worstcase scenario, the stock 7 or below and you put the stock there. You would have losses. On a leverage to the upside. The 5. That as huge percentage. That would only make sense if there was a deal and the stock exploded higher. What do you think of the trade . It makes a lot of sense. Right now we have a situation where gently speaking, ropgss very cheap. So we want to be better buyers. But in sprint thats not the case. Youre going to pay quite a lot by selling two options. The other thing is that seven strike where he will put the stock, if it does decline. It arraignments 20 . And he gives himself a lot of room. A lot of risk guys like to be short upside calls when they think there might be a deal in the works. First, this is one of the things is that this was left for dead. It was 2. And things that are thought to be zero, they end up not being zeroes. Its been back for so long, it looks quite rested to my eye. And ultimately theres more upside. In a consumer type area, where everything is bad. Whether it is viacom and disney, media, this is a good area to be in. All right. Up next, boeing slipping from its all time high. And theres something in the charts that points to more pain ahead. Hey gary, whatd you got here . This bad boy is a mobile trading desk sohat i can take my Trading Platform wherever i go. You know that thinkorswim seamlessly syncs across all your devices, right . Oh, so my custom studies will go with me . Anywhere you want to go the markets hot sync your platform on any device with thinkorswim. Only at Td Ameritrade oh hey john, im connecting our brains so we can share our amazing trading knowledge. Thats a great idea, but why dont you just go to thinkorswims chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders . I know. Your brain told my brain before you told my face. Mmm, blueberry . Tap into the knowledge of other traders on thinkorswim. Only at Td Ameritrade. Welcome back. Time for the upside call. We look back at some of our winning trades. Two weeks ago, a bet on boeing and now it looks like mikes strayed about to pay off. On options action, its how we play offense ask defense. Risk less so we can make more. Thats what carter did. He thought boeing had run too far too fast. To my eye, thats your next move. Too far too fast. Do something. He thought maybe carter is on to something. But just shorting the stock, that could lead to infinite losses. So to make a bearish bet, he sold the call to 6. 30. Above that, profits will trail off. But mike wont see losses until boeing rises by more than the 6. 30 he collected. Remember, there is a tradeoff. Because above 180, he will see losses. We are serious and dont call me surely. So he bought the 1. 90 call for 2 and created his bear call spread. Between the 6 30 he collected by selling that lower strike call and the 2 he spent buyer the higher strike call, he still pocketed 4. 30. That is the most he can make on the trade. And to keep all of it, he needs the shares to stay below 184. 30. Above, that he starts to see losses. But they are limited to the differences between the vik of the call that he sold and he bought. Minus the credit. Let me make it really simple. He can now make money whether boeing drops, stays flat or goes slightly higher. And boeing shares have fallen 2 meaning this is right in the sweet spot. Now options actions fan want to know one thing. What will Cullen Carter do now . This is working out just fine. As long as he is along with me on this one, these will expire before earnings. So were continuing to collection premiums. I think we should. Despite the strength, i dont see the stock going significantly higher. Not much has happened. The stock hit a low of 177. Back to 180. It should be the beginning of more trouble. All right. Up next, your tweets. Hey nicole. Hey i just wanted to thank your support team for walking me through my First Options trade. We only do it for everyone gary. Well, i feel pretty smart. Well, were all about educating people on options strategies. Well, dont worry, i wont let this accomplishment go to my head. Im still the same old gary. Wait, you forgot your french dictionary. Oh, mucho gracias. Get help on options trading with thinkorswim, only at Td Ameritrade. And the wolf huffed like you do sometimes, grandpa . Well, when you have copd, it can be hard to breathe. It can be hard to get air out, which can make it hard to get air in. So i talked to my doctor. She said. Symbicort could help you breathe better, starting within 5 minutes. Symbicort doesnt replace a rescue inhaler for sudden symptoms. Symbicort helps provide significant improvement of your lung function. Symbicort is for copd, including chronic bronchitis and emphysema. It should not be taken more than twice a day. Symbicort contains formoterol. Medicines like formoterol increase the risk of death from asthma problems. Symbicort may increase your risk of lung infections, osteoporosis, and some eye problems. You should tell your doctor if you have a heart condition or high Blood Pressure before taking it. Symbicort could mean a day with better breathing. Watch out, piggies child giggles symbicort. Breathe better starting within 5 minutes. Get symbicort free for up to one year. Visit saveonsymbicort. Com today to learn more. Hthis bad boy is a mobile trading desk so that i can take my Trading Platform wherever i go. You know that thinkorswim seamlessly syncs across all your devices, right . Oh, so my custom studies will go with me . Anywhere you want to go the markets hot sync your platform on any device with thinkorswim. Only at Td Ameritrade the first tweet comes from brian kelly who asks mike, is dans hair real and is it as spectacular in real life as it looks on tv . Mike, what do you say . It is real and disspectacular. Im very envious. This is your opportunity to brag on him. All right. I understand. But this is coming from a guy who probably needs implants himself and he doesnt. Your hair is speck spend too. Our next tweet cops from our old friend never france. A long time viewer. He says happy quadruple witching day. This sounds like a question for mike. You know, i would prefer to be short premium in herbal life. Its tough. It is so high that it elevates the price of puts. Decreases the price of cause. I almost feel like it is a no touch. All right. Thank you. Time for the final call. Carter . Get long nike, or add to it if youre already long. Mr. Mike . City banc, i think you pick on the biggest one. Thank you for watching. For out options action. Cnbc. Com. Mad money starts right now. My mission is simple, to make you money. Im here to level the Playing Field for all investors. Theres always a bull market somewhere, and i promise to help you find it. Mad money starts now. Hey, im cramer. Welcome to mad money. Welcome to cramerica. Other people want to make friends. Im just trying to make you some money. My job is not just to entertain but to educate and teach. So call me at 1800743cnbc or tweet me jimcramer. Once again we waited for the market to get hammered. It seems like we do that every day. And once again the market failed
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