Meritage Homes Corporation (MTH) is a designer and builder of homes in the U.S. The company’s stock is currently trading around $42.50 in a 52 week range of $38.42-$52.95. The stock has been underperforming the market this year with shares falling nearly 11.6% year to date. In spite of the stocks weakness this year we are seeing traders stepping in to get long MTH before they report earning on Apr 23^rd. Earlier today a trader bought 2,000 MTH Sep 45 Calls for $2.90. This is the largest block to trade in MTH on a day when options volume in MTH is 8 times the average daily volume. Although the stock is weak on a chart this is a sizeable bet and could signal for a long opportunity in MTH.

Block Trade: A trader bought 2,000 MTH Sep 45 Calls for $2.90
Risk: $290 per 1 lot
Reward: Unlimited
Breakeven: $47.90

T-Mobile US, Inc (TMUS) is a provider of mobile communications services in the U.S., Puerto Rico, and the U.S. Virgin Islands. The company’s stock is currently trading around $30.85 in a 52 week range of $16.01-$34.10. The stock has been doing relatively poorly this year with shares falling 8.65% year to date. Despite the stock’s relative weakness this year options traders are betting on some short term upside in TMUS. Earlier in today’s trading session a trader bought 2,187 TMUS Apr 25^th weekly 31 calls for $0.55. This is a 1 week bet that the stock will trade above the breakeven of $31.55 on expiration.  While weekly calls can be risky on a risk vs. reward basis I like this trade setup.

My trade: Buying the TMUS Apr 25^th Weekly 31 Calls for $0.62
Risk: $62.00 per 1 lot
Reward: Unlimited
Breakeven: $31.62

The Gap, Inc. (GPS) operates as an apparel retail company worldwide. It provides apparel, accessories, and personal care products for men, women, and children under the Gap, Banana Republic, and Old Navy brands.  Yesterday we saw a HUGE bullish bet in GPS to the upside as a trader bought 4,000 GPS May 40 Calls for $.59 and I jumped in on these calls as the price was through the offer.  A trader thinks the stock can get back into the Ichimoku Cloud on the daily within the next month.  Let’s look at the trade I took:

The Trade: I bought the GPS May 40 Calls for $.60
Risk: $60 per 1 lot
Reward: Unlimited
Targets: $.75, $.90, $1.10 and $1.30

Greeks of this Trade:
Delta: Long
Gamma: Long
Theta: Short
Vega: Long

Skyworks Solutions, Inc. (SWKS) is a producer of semi-conductors and integrated circuits. The company’s stock is currently trading around $32.55 in a 52 week range of $19.57-$39.33. The stock has been outperforming the market this year with shares rallying nearly 25% year to date. SWKS call options have been active today with a block of May 37 calls being bought this morning. A trader bought 2,500 SWKS May 37 calls for $1.25, labeled as an opening position. This is a $312, 500 bet on further upside in SWKS through May expiration. With shares of SWKS trading above the Ichimoku Cloud it would appear that this trader is getting long rather than hedging a short position.

Block Trade: Trader bought 2,500 SWKS May 37 Calls for $1.25
Risk: $125 per 1 lot
Reward: Unlimited
Breakeven: $38.25

Cheniere Energy (LNG) is an energy company engaged in the liquefied natural gas  related business. It operates through two segments, LNG Terminal Business, and LNG and Natural Gas Marketing Business. Today a trader bought 8300 LNG Jan 2015 65-80 Bull Call Spreads and sold the 45 Puts for $.40 credit. This trader will get LONG LNG at two different levels, $45 and $65. This is a bullish bet and the trader will make money as long as LNG stays above $44.60 by Jan 2015 expiration.

My Trade: Buying the Jan 2015 65 Calls for $4.55
Risk: $455 per 1 lot
Reward: Unlimited
Targets: 5, $5.00 and up every $.40

Greeks of this Trade:
Delta: Long
Gamma: Long
Theta: Short
Vega: Long

The iShares MSCI Mexico Capped ETF (EWW) seeks to track the investment results of a broad-based index composed of Mexican equities.  I watch over 1300 trades a day and this is one of the only two trades that I have taken today.  The chart looks great and I think that EWW will break to the upside and one trader thinks the stock is heading north of $66.

My Trade: Buying the EWW 5.30.2014 65 Calls for $1.55
Risk: $155 per 1 lot
Reward: Unlimited
Targets: $1.75, $1.95, $2.15, $2.30 and $2.75

Yelp Inc. (YELP) operates as an online local guide that connects people primarily with boutiques, mechanics, restaurants, and dentists.

Yesterday, we at www.keeneonthemarket.com saw a trader buy 9,500 YELP May 75-90 bull call spread for $2.60 debit.

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Pandora Media, Inc. (P) provides internet radio services in the United States. The company allows listeners to create up to 100 personalized stations to access free music and comedy, as well as offers Pandora One, a paid subscription service to listeners.  Yesterday, we at www.keeneonthemarket.com saw a trader buy 21,676 P May 31-35 Bull Call Spread for $.55 debit.  This is a HUGE bet that P will trade above $31 by May expiration.  This was a $1.5 Million bet, so yesterday I bought the May 31 Calls for $.95 and I am up over $8,000 in 2 days and I think that P has more upside potential.

The Trade: I bought the P May 31 Calls for $.95
Risk: $95 per 1 lot
Reward: Unlimited
Targets: $1.10, $1.30, $1.50 and $1.75

Greeks of this Trade:
Delta: Long
Gamma: Long
Theta: Short
Vega: Long

Express, Inc. (EXPR) is a men’s and women’s clothing retailer selling apparel and accessories in stores and online. The company’s stock is currently trading around $15.80 in a 52 week range of $15.42-$25.05. The stock has been underperforming the market this year with shares falling more than 15% year to date. Options traders seem to think that this trend will reverse as orders hitting the tape today are very bullish. Earlier this morning a trader bought 2,000 EXPR May 15 calls for $1.27. This trader is betting more than $250,000 on upside in EXPR through May expiration. With stock just off of 52 week lows this is an aggressive countertrend setup. This does however suggest this trader has a relatively high level of bullish conviction in EXPR.

Block trader: Bought the May 15 Calls for $1.27
Risk: $127 per 1 lot
Reward: Unlimited
Breakeven: $16.27

MGM Resorts International (MGM) owns and operates casinos and resorts in the U.S. and China. The company’s stock is currently trading around $24.00 in a 52 week range of $11.97-$28.75. The stock has performed relatively well this year with shares rallying 2.25%. Options orders hitting the tape early in this morning’s trading session would indicate that traders believe this trend will continue through the end of the year. Early this morning a trader bought 14,674 MGM Jan 2015 30 calls for $1.10. This is a very bullish trade that requires this trader to lay out more than $1.6 million in capital. Although the stock has traded below the cloud, it is still in positive territory this year. With such a large bet being made in MGM it would appear that this trader is expecting some serious upside for MGM this year.

Block Trader: Bought the MGM Jan 2015 30 Calls for $1.10
Risk: $110 per 1 lot
Reward: Unlimited
Breakeven: $31.10