Options traders are betting that Lululemon can stretch higher after earnings

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Options traders feeling Zen about Lululemon

Lululemon is running away with the athleisure trade.

The stock is up nearly 90% heading into Wednesday's report, while its nearest competitor, Adidas, is only up 46%. If things go well after the bell, Lulu might just double up its value this year.

"The options are implying an 8% move, which is a little cheaper than the last few quarters," Realm Startup Advisory founder Roger DaSilva said Tuesday on "Fast Money." "What that tells me is, you have a lot of people positioning for upside with two and a half times the calls trading over the puts."

While a pop of 8% after the bell on Wednesday wouldn't quite take the stock over the mark of 100% gains on the year, one big block of trading on Tuesday showed that at least some folks in the options market are betting on Lululemon getting the job done.

"Specifically, the January 20-calls, about 1,400 traded today," said DaSilva, "about 4,200 [of those calls] in the open interest."

Those calls break even if the stock is above $255.58 by January expiration, which would represent a jump of more than 11% from Tuesday's close. 

DaSilva called this a classic stock replacement trade.

As he sees it, a lot of Wednesday's call buying could be from traders who are taking profits in the stock after its tremendous run higher.

Instead of going all-in on buying more stock into a catalyst like earnings that might land them with an immediate loss of 8% or more, DaSilva thinks these traders are looking to participate in any more potential upside through buying calls.

Lululemon was trading slightly higher in Wednesday's session.

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