Google (GOOGL) reports Q1 results tomorrow after the close, the options market is implying about a 4% one day move vs the 4 qtr avg of about 3.8%.
Earlier when shares of the C class, GOOG, were trading $538 there was a buyer of out of the money calls in May and June. A buyer paid 3.70 for 1800 of the May 575 calls to open and paid 5.10 for 1800 of the June 585 calls. While the contract sizes are not huge, the premium is fairly meaty given how far out of the money both call strikes are.
For May, the trade cost $666,000 in premium and breaks even at $578.70 on May expiration, up 7%, almost 2x the implied move.
As for the June, the trade cost a little more than $1 million and breaks-even at $590.70, up about 10%
The implied one day move is about $22, which looking at the one year chart of GOOG shows the break-evens if you were to buy the move, essentially buying the April 24th weekly 540 straddle offered at about $22, you would need a move above $562, or below $518. both levels that look like technical resistance and support:[caption id="attachment_53001" align="aligncenter" width="600"] GOOG 1yr chart from Bloomberg[/caption]
May vol is about 27 and June 23 going into the event. Those both will be closer to 20 vol after.