Dan Nathan Sees Unusual Options Activity In Tesla

On CNBC's Options Action, Dan Nathan spoke about unusually high options activity in Tesla Motors Inc TSLA. He said that the options activity on Tuesday was very short dated and it looks to him that traders are trying to protect their long positions against a pullback.

There was one large trade that caught Nathan's attention during the trading session. A trader bought 6,000 contracts of the January 250 puts for $2.35. The trade breaks even at $247.65 or 2.73 percent lower and it expires at the end of the week. Nathan explained that Tesla Motors has recently jumped above $250, which is now going to act as a support and he sees that as a main reason for the trader to pick $250 strike puts for protection.