On CNBC's "Options Action," Mike Khouw spoke about bearish options activity in Walt Disney Co (NYSE:DIS) ahead of earnings. He said that puts significantly outpaced calls on Monday and ultimately they traded two times the average daily put volume.

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The options market is implying a move of 5% in either direction and it typically moves around 2.2% on the event. The most active contracts were the August $115/$105 put spreads. Traders paid around $2.50 for them, which sets the break-even at $112.50. The maximal profit is $7.50.

Khouw concluded that it seems retail traders are making bearish bets that Disney is going to be a little bit disappointed out of earnings.