On CNBC's "Options Action," Mike Khouw followed up on his September 18 trade in Nike Inc. (NYSE:NKE).

The stock spiked through the strike of the covered call, but it failed to hold the gains so now the call that Khouw sold is worth only a couple of bucks more. The covered call position is still okay, said Khouw and added that traders should buy to close the call before the expiration if it stays in the money.

Those who don't have a position in Nike should sell the November $115 puts and buy the January $120 puts for a total cost of $4.75, thinks Khouw. He expects the stock to trade sideways for some time, so he wants to reduce the cost of the January put by the November $115 put sale.