NFLX Options Signal $93 Put Hedge as Calls Target $110 Breakout: How to Play the WBD Drama

• NFLX trades at $94.20, clinging to a 0.59% intraday gain amid a long-term bearish trend.
• Options market shows heavy put/call balance (ratio: 1.02), with top OTM puts at $93 and calls at $110 (next Friday expiry).
• Regulatory risks from the $72B WBD acquisition and insider selling weigh on sentiment, but Bollinger Bands hint at $86.55 support.

Here’s the core insight: NFLX is trapped between regulatory headwinds and options-driven hedging, with technicals pointing to a potential bounce off key support—or a breakdown into uncharted bear territory. The stock’s 23.6 RSI suggests oversold conditions, but the MACD (-121.39) and bearish Kline pattern warn of lingering downward pressure. Let’s break it down.

The Options Playbook: Puts Guard $93, Calls Dream of $110

The options chain tells a story of caution. For this Friday’s expiry, OTM puts at $93 ($6,346 OI) and $90 ($4,532 OI) dominate, while next Friday’s expiry sees even heavier interest at $88 ($4,258 OI) and $93 ($2,863 OI). This suggests institutional players are hedging against a potential drop below $93—a level that aligns with the 30D support zone (92.71–114.0058).

On the call side, next Friday’s $110 strike ($23,794 OI) is a standout. Think of it as a "wish list" strike for bulls betting on a post-regulatory-clearance rebound. The $95 and $98 calls also show traction, but the $110 level acts like a psychological ceiling for those expecting a WBD deal-driven rally.

Block trades? None to report. But the put/call balance (1.02) implies a standoff between bears and bulls—neither side willing to commit fully.

News vs. Options: A Regulatory Tightrope

The WBD acquisition is a double-edged sword. On one hand, it’s a $72B bet on content dominance, backed by $25B in new financing. On the other, film producers are lobbying Congress, and rivals like Paramount are circling. The insider selling (e.g., a director offloading $40.7M in shares) adds to the unease.

Here’s where options sentiment lines up with the news: the heavy put interest at $93 mirrors the stock’s recent 30D support level. If the DOJ blocks the deal or a rival outbids Netflix, the stock could crater toward the lower Bollinger Band ($86.55). But the call activity at $110 hints that some traders still see a path to $100+ if the deal closes smoothly.

Trade Ideas: Protect the Downside, Snipe the Upside

For options traders, consider these setups:

• Hedge with NFLX20260102P93: With 2,863 OI next Friday, this put acts as insurance if the stock breaks below $93. Target a 10–15% move if the DOJ intervenes.
• Bullish spread: NFLX20260102C95 + NFLX20260102C110: Buy the $95 call (15,084 OI) and sell the $110 call to cap risk. A $94.20–$95.50 rebound could trigger this play.

For stock traders, watch these levels:

• Entry near $92.71 (30D support): If the stock holds here, target a bounce to $98.35 (middle Bollinger Band).
• Break below $93: Aggressive buyers might chase the $86.55 lower band, but this would signal a deeper selloff.

Volatility on the Horizon: The WBD Crossroads

The next two weeks will define NFLX’s trajectory. Regulatory rulings, insider moves, and Paramount’s $30/share bid could all shake the stock. The options market is pricing in a 50/50 bet: $93 as a floor, $110 as a ceiling. For now, the technicals favor caution—but don’t rule out a surprise rally if the DOJ gives the green light. Stay nimble, and keep an eye on those Bollinger Bands. They might just be the lifeline NFLX needs.