Dan Nathan's JPMorgan Chase & Co. Trade

Dan Nathan recommended on CNBC's "Options Action" a bearish options strategy in JPMorgan Chase & Co. JPM.

He said that JPMorgan Chase & Co. is the only bank that is trading significantly above its August lows, and he can't understand why it is showing such a relative strength. Nathan believes that the banking sector could struggle after the stress test results and after the Q1 earnings so he wants to set up a position that can last until the April Expiration.

Related Link: JPMorgan Rockets Higher

Nathan wants to sell the February 19, 55 strike put for $0.60 and buy the April 55 put for $2.60. If the stock stays above 55 at the February 19 expiration, he is going to own the February 55 put for $2. The trade starts to make money below $53 or 7.8 percent lower from the current price.