Mike Khouw Sees Unusual Options Activity In Tesla Ahead Of Earnings

Mike Khouw spoke on CNBC's "Options Action," about unusually high options activity in Tesla Inc TSLA. The company is scheduled to report earnings on Wednesday and Khouw noticed that calls outpaced puts by about 2 to 1 on Tuesday. Most of that activity was short-dated.

The options market is implying a move of about 14% in either direction by the end of the week, said Khouw. The implied move is higher than Tesla's average move of 9.3% on the event.

Khouw noticed the most active options on Tuesday were the July 24, $2,000 calls. Almost 20,000 contracts were traded for around $25. Buyers of these calls are betting that the stock is going to jump above $2,025 or around 30% higher from the closing price on Tuesday.