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Micron, already up 50% this year, could see a big breakout on earnings Thursday

Micron has been on a tear this year, and some traders say the chip stock is about to rip even higher.

With the semiconductor company reporting earnings after the closing bell on Thursday, the options market is implying a 7 percent move in either direction for the stock. According to Mike Khouw of Optimize Advisors, the move could be higher.

"Micron is a name that typically moves a decent amount on earnings, around 6 percent, but it's implying a larger move than that this time," Khouw said Wednesday on CNBC's "Fast Money."

Khouw noted there was a surge in bullish trading activity for the chip stock with call options quadrupling that of puts. A number of traders also bought the March weekly 63 calls for an average price of $1.50 per contract. These are bullish bets the stock will close the week above $64.50, or roughly 9 percent higher than where the stock is currently trading. Khouw noted some investors also bet on longer-term call spreads for Micron, which imply the stock could rally above $65 next month.

Shares of Micron have surged more than 48 percent since January and over 134 percent in the last 12 months. Also worth noting: 25 of the 31 FactSet-listed analysts rate the stock as a buy, with an average price target of $67.85. That would imply a 13 percent rally from current levels.

Last month, Micron raised its earnings and revenue guidance for the second quarter resulting in a near 8 percent gain on the day.

Micron was trading at $58.73 on Thursday morning, down 2.3 percent.

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