Bonawyn Eison Sees Unusual Options Activity In Delta Air Lines

On CNBC's "Options Action," Bonawyn Eison spoke about unusually high options activity in Delta Air Lines, Inc. DAL ahead of earnings. He said calls outweighed puts two times to one on Monday, after being evenly distributed throughout the early part of the session.

Options are implying a 7.5% move in either direction between now and Friday, which is significantly higher than the average move of 2.25%.

There was a trade on Monday that caught Eison's attention. Around 14,000 contracts of the July weekly, $26/$27 strangle were traded for $2.35. A trader sold this options structure and collected a premium of $2.35. The break-even for the trade is at $29.35 or around 9.4% higher on the upside and at $23.65 or around 13.4% lower on the downside.

Eison explained that the trader is taking advantage of high implied volatility in the options market while betting that the stock is going to be a bit range bound.