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Pete Najarian Spots Unusual Options Activity in Energy Sector

Friday, 14 Oct 2011 | 3:42 PM ET

Fast Money’s Pit Boss is always trolling for unusual options action and on Friday he spotted some big fish.

According to Pete Najarian the volume of October 15 calls in Weatherford is reason enough to sit up and take note.

”19,000 calls traded in the first two hours of the session,” he says. “It’s an extreme amount of activity.”

Najarian finds the buying impressive because these options expire in only one week. “That suggests institutional investors are looking for plenty of upside within only the next 5 session.”

Trader Patty Edwards sees a fundamental catalyst behind the action. “It’s a name that’s been beaten down a lot. It could be a bet on M&A.”

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MOODY'S DOWNGRADES SPRINT

Meanwhile Sprint also landed on the trader radar after Moody's lowered its rating on the company’s debt.

Moody’s also said the rating remains on review for possible further downgrade due to the significant execution risks associated with its network upgrade plans.

What’s the trade?

Jon Najarian thinks the stock is a hold. “I don’t see it as a buy unless it drops to $2.50. But if you’re long – hold and hope there’s good news when they report – I think there may be – I think they benefit from having the iPhone.”

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TRADING THE GLOBE - CHINA

China’s consumer price index cooled slightly in September, backing what some economists saw as softening inflation trend that will enable Beijing to push ahead with easier monetary policy.

So how should you trade now?

Find out from emerging markets specialist Tim Seymour. Watch the video now!

Trading China & Stock Pops
The emerging market trade on China, with Tim Seymour, Seygem Asset Management and the Fast Money traders look at the midday stock pops and drops.
















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FOLLOW ICAHN INTO NAVISTAR

Fast Money friend Carl Icahn did it again. A day after announcing a stake in Navistar , shares surged with investors hoping Icahn will unlock value.

Specifically, Icahn reported a 9.8 percent stake in the company and said its shares have been undervalued.

Icahn has held talks with Navistar's management to discuss its business and will seek to have additional conversations to discuss strategies, the investor said in a filing with the U.S. Securities and Exchange Commission.

Should you follow Icahn in?

None of the Fast traders suggests trading in this whale’s wake.

Trader Steve Grass says, “It didn’t work out with Clorox or Lions Gate. Once he gets involved, it makes the story cloudy.”

If you’re looking for a play in the space, rather than Navistar, Pete Najarian suggests playing the rails long via CNX or UNP.

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Midday Money In Motion Trade
What's next for the euro? Greg Troccoli, The Chart Lab founder, shares his outlook.

MONEY IN MOTION: EURO

The euro looks to be back on track for its biggest weekly gain since January on renewed hopes for a European resolution ahead of the big G20 meeting.

So what's next for the euro?




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Trader disclosure: On Oct 14, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; P. Najarian is long AAPL; P. Najarian is long AKAM; P. Najarian is long C; P. Najarian is long MS; P. Najarian has long calls WFT; J. Najarian has long call spreads ANF; J. Najarian has long call spreads AAPL; J. Najarian has long call spreads GOOG; J. Najarian has long call spreads NVDA; J. Najarian has long call spreads IBM; J. Najarian has long call spreads WFT; J. Najarian has long call spreads SWN; J. Najarian is long CME; J. Najarian is long CBOE; J. Najarian is long CIGX; Edwards is long TQNT; Edwards is long XLK; Grasso owns AA; Grasso owns AKS; Grasso owns ASTM; Grasso owns BA; Grasso owns BAC; Grasso owns BAS; Grasso owns D; Grasso owns LIT; Grasso owns MHY; Grasso owns PFE; Grasso owns PRST; Grasso owns S; Grasso owns XLU

From Patty Edwards
Trutina Financial owns Apple (AAPL)
Trutina Financial owns Citigroup (C)
Trutina Financial owns Google (GOOG)
Trutina Financial owns Oracle (ORCL)
Trutina Financial owns SPDR Gold Trust (GLD)
Trutina Financial owns AAPL
Trutina Financial owns TARGET (TGT)
Trutina Financial owns AMZN
Trutina Financial owns QCOM
Trutina Financial owns SWN

For Tim Seymour
Triogem Asset Management is long BBD
Triogem Asset Management is long ITUB
Triogem Asset Management is long SBRCY

For Greg Troccoli
No disclosures

For Youssef Squali
I, Youssef H. Squali, certify that all of the views expressed in this research report accurately reflect my personal views about the subject security(ies) and subject company(ies). I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in this research report.

For Brian Kelly
Kelly is short euro
Kelly is long FXE puts



CNBC.com with wires.

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