Mike Khouw Sees Unusual Options Activity In Snap

On CNBC's "Options Action," Mike Khouw spoke about unusually high options activity in Snap Inc SNAP. The company is going to report earnings on Tuesday after the market closes.

Khouw said options traders are betting the rally in Snap could continue as call options outnumbered puts 4 to 1 on Monday. He added that the stock moves quite sharply on earnings. It has averaged nearly 17% over the last eight quarters and this week it's implying a move of 14% in either direction.

One of the bullish bets during the session on Monday was a purchase of 1,365 contracts of the Aug. 15 calls for $0.84, said Khouw. The trade breaks even at $15.84 or 12% above the closing price on Monday.

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Snap's stock traded higher by 1.8% to $14.40 at time of publication.

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