As Hurricane Sandy bears down on New England I figure I had some time to put together a quick educational post with two examples from last week, focusing on trading stocks/options following an earnings reaction.I often utilize my analysis of options activity to determine the magnitude and direction a stock will trade after earnings, and position for this with various option strategies, but it also pays to know where the big money is positioned for post-earnings trading.It pays to be prepared knowing how the options market is positioned, key technical levels, and the valuation that would make a stock a buy on an over-reaction gap-down.Western Digital (WDC) reported earnings last week and into the report I was tracking large November bullish risk reversals.  Traders were actively selling to open puts at the $32 strike in November and also at the $35 strike in the week leading up to earnings and also buying calls at the $39 and $41 strike, but the key takeaway was that large traders were willing buyers of the stock with the put sales.  I figured it was best to wait out the earnings because WDC headline results would likely disappoint due to its exposure to the dying PC market, but looking at valuation shares were trading less than 5X forward earnings, 0.7 PEG, and 2.5X cash value, so I figured downside was limited.  I also looked at the 5 year chart and a trend line off the 2009 lows and 2011 lows came into play near $32.50.  After reporting results WDC shares gapped down to lows at $32.25 from $35 and utilizing the info that I had prepared (above) I picked up the stock at $32.45 as a day-trade and was able to sell near $34.75 later that day, a great intraday scalp.Chicago Bridge and Iron (CBI) is another example, a stock that reported earnings on 10/23, and one where I had seen 6,000 January 2013 $36 calls bought to open on 10-19, so it had a bullish bias, but as an Industrial I once again wanted to wait out the numbers.  CBI was also a case where large trades hit right in the morning after it gapped lower with more than 6,000 December $34 ITM calls bought to open (ITM Calls = High Delta = Very Bullish) as well as large sales of the Decemebr $34 puts that sent Implied Volatility spiraling lower.  CBI has longer term trend support near $36 and the $3.6B Co. trades 10.77X earnings, 0.69X sales, and 2.73X book with 15% EPS growth seen for FY13, so a cheap value name and a history of strong operations.  In this case it was one where I would not own buying the stock at a $33.40 cost basis, so selling December $34 puts to open was the way I decided to play the name.I have to wrap this up because a friend just let me know he lost power, so I may not be far behind, but hopefully this post was educational/informative of another way to utilize options flow in trading.