Carter Worth And Mike Khouw's Intel Corporation Trade

On CNBC's Options Action, Carter Worth spoke about the semiconductor space. He thinks that it is the leading indicator for the market and he noticed some signs that it is close to a reversal point. Worth explained that PHLX Semiconductor index topped or bottomed before the S&P 500 INDEX in five from the last six turning points in the last 16 years and he wants to place a bearish trade in Intel Corporation INTC as a way to exploit a potential pull back in the semiconductor space. Worth thinks that Intel Corporation is going to pull back to its trend line and he sees it at $27 or 10.45 percent lower. Mike Khouw suggested an options strategy that is going to make money if Worth's analysis is correct. He wants to sell the July 30/31 call spread for $0.50. If Intel Corporation trades above $30.50, the trade is going to loose money and its maximal loss is $0.50. If the stock trades at or below $30, the trade can maximally make a profit of $0.50.