Mike Khouw Sees Unusual Options Activity In Applied Materials

On CNBC's "Options Action," Mike Khouw spoke about unusually high options activity in Applied Materials, Inc. AMAT ahead of the earnings report, which is scheduled for Thursday after the market close.

The options market is implying a move of 4.8% in either direction, which is slightly higher than the average move of 4.2% over the last eight quarters. Calls outpaced puts by about 1.6 to 1 on Wednesday as around 1,800 contracts of the May $127 calls were traded for $1.16. The trade breaks even at $128.16 or 2.69% above the closing price on Wednesday.