Mike Khouw Sees Unusual Options Activity In Nordstrom

On CNBC's "Options Action," Mike Khouw said he saw a tremendous amount of options activity across the retail space. Nordstrom, Inc. JWN was one of the names with high options volume and it reached 2.4 times the average daily options volume on Monday.

During the session, Khouw noticed a big puts sale in Nordstrom and also a purchase of 3,000 contracts of the August $37/$42.50 call spread for 57 cents. The call spread trade is targeting the earnings results, scheduled for August 24 and it breaks even at $37.57 or around 19% above the closing price on Monday. If the stock jumps to $42.50 or higher at the August expiration, the trade is going to reach its maximal profit of $4.93.