Facebook shares have surged nearly 44 percent this year, but some traders appear to be pumping the brakes on the stock ahead of earnings Wednesday afternoon.
"Over the past five days, Facebook has been the second-most-active single stock option that's being traded [in the options market]," Mike Khouw of Optimize Advisors said Tuesday on CNBC's "Fast Money."
While options activity in Facebook has been extremely bullish in the last week, most of the opening activity on Tuesday was bearish, according to Khouw.
The most notable trades were the purchases of over 5,500 of the 157.5-strike puts for $2.30 per options contract. These are bearish bets that Facebook shares will sink below $155.20 by August expiration, which is more than 6 percent lower from Wednesday's trading price.
Dan Nathan of RiskReversal.com added that Facebook "has rallied 10 percent in the last couple weeks," as bulls have piled into the name. "I think you could have a similar sort of move that Google had [on earnings]. I think it's a digestion of that [upside] move."
Facebook is expected to move around 5 percent in either direction following its report, which is in line with the average move over the past eight quarters.
Analysts polled by FactSet are expecting the social giant to report earnings of $1.12 per share on $9.2 billion in revenue.
Facebook shares were trading at the $165.20 range during midday Wednesday.