Mike Khouw Sees Unusual Options Activity In Alcoa

Mike Khouw analyzed a trading activity in

on Tuesday. He said that daily options volume was two times higher than the average daily options volume. The options market is implying a 4 percent move on earnings day, which is higher than the average move on earnings of 3 percent. There were more bullish than bearish trades and one bullish trade caught Kouw's attention. A trader bought 4,400 contracts of the April weekly 13.50-strike calls for $0.30. The break-even for the trade is at $13.80 or approximately 3 percent higher at the expiration this week.

will report earnings on Wednesday.