Dan Nathan's Boeing Trade

Dan Nathan suggested on CNBC's Options Action a bearish options strategy in Boeing Co BA.

He presented a chart of the stock and showed that it failed to reach $140 on Friday. This is an important price level because it was a support in August when the stock dropped sharply to $115. When support doesn't hold, it becomes resistance and since Boeing failed to break out above resistance, Nathan believes that it could test its August lows. The catalyst for a decline could be an earnings miss and a downgrade of a guidance in October.

To make a bearish bet, Nathan wants to buy the October 135 put for $3.80 and sell the October 120 put for $0.80. The put spread would cost $3 and that is his maximal risk. If the stock trades to $120 at October expiration, he can make a maximal profit of $12.