By Jud Pyle, CFA, chief investment strategist for the Options News Network

CHICAGO (

TheStreet

) -- Retailers

Nordstrom

(JWN) - Get Report

and

Chico's FAS

(CHS) - Get Report

are scheduled to announce earnings in the near term, and we're seeing bullish and bearish activity, respectively, hit the tape today.

Looking at options activity in JWN, an investor bought 10,000 Aug. 30 calls and simultaneously sold the same number of Aug. 25 puts for approximately 69 cents per spread to express a bullish stance on the retailer.

Heading into today's trading, the August 30-strike call was home to open interest of 8,000 contracts, according to OptionsHouse.com's options chain. The volume weighted average price of the Aug. 30 calls that traded today was approximately $1.15. These calls are up 15 cents on the day, and the stock is up 22 cents to $29.58 a share. The Aug. 25 puts, meanwhile, traded 10,400 times versus current open interest of 2,500 contracts and are down eight cents so far on the day. These puts had a VWAP of 22 cents.

JWN shares have rallied 60% since dipping to a recent low of $19 last month, but it's interesting that we're seeing an investor betting on even more upside the day before the department-store retailer announces second-quarter earnings figures. The investor needs JWN shares to expire higher than $30.69, a 4% rally, next week to make money on this bullish trade. JWN shares are currently up 21 cents to $29.57.

Now let's take a look at CHS Nov. 10 puts, which have traded more than 13,000 times (at a VWAP of 86 cents) and are home to current open interest of 2,500 contracts. These puts are up 15 cents with the stock down 13 cents to $11.82, which suggests more buyers than sellers. The implied volatility of these puts is 71.2 with a 30-day realized volatility of 56.8.

The investor needs CHS shares to expire lower than $9.14 this month. CHS is scheduled to announce earnings information on Aug. 25 before the market opens, but one investor is expecting at least a 22% drop in stock by the end of next week.

-- Written by Jud Pyle in Chicago

Jud Pyle, CFA, is the chief investment strategist for Options News Network. Pyle started his career in finance in 1994 as a derivative analyst with SBC Warburg. After four years with Warburg, Pyle joined PEAK6 Investments, L.P., in 1998 as an equity options trader and as chief risk officer. A native of Minneapolis, Pyle received his bachelor's degree in economics and history from Colgate University in 1994. As a trader, Pyle traded on average over 5,000 contracts per day, and over 1.2 million contracts per year. He also built the stock group for all PEAK6 Investments, L.P. hedging, which currently trades on average over 5 million shares per day, and over 1 billion shares per year. Further, from 2004-06, he managed the trading and risk management for PEAK6 Investments L.P.'s lead market-maker operation on the former PCX exchange, which traded more than 10,000 contracts per day. Pyle is the "Mad About Options" resident expert. He is also a regular contributor to "Options Physics."