PEP Options Signal Bullish Bias: Key Strikes and Block Trades Point to Strategic Entry Zones

• PEP trades at $146.72, down 0.57% from $147.55, with intraday support at $145.30 and resistance at $151.33.
• Call open interest dominates at $155 and $152.50, while a $140 put block trade hints at a potential price floor.
• UBS cuts price target to $170, but rebranding and Celsius partnership could drive long-term optimism.

Here’s the core insight: PEP’s options market is leaning bullish, with heavy call open interest at key strikes and a massive block trade suggesting institutional confidence. But short-term technicals show a bearish bias—this tension creates a high-probability setup for traders who know where to position.The Options Imbalance: Calls vs. Puts and What It Means

Let’s start with the numbers. The options chain shows a clear skew toward calls, especially at the $155 and $152.50 strikes (2,283 and 772 open interest, respectively). These are 6-8% out-of-the-money strikes, meaning investors are betting on a meaningful move higher. Meanwhile, puts dominate at $145 and $146, with 418 and 307 open interest. The put/call ratio of 0.73 (calls > puts) reinforces the bullish tilt.

But here’s the twist: A massive block trade of 30,000 puts at the $140 strike (expiring October 2025) suggests a whale is hedging against a deep selloff. This isn’t just noise—it’s a signal that someone with skin in the game sees downside risk. The $140 level is also near the lower Bollinger Band ($138.80), making it a psychological floor.

What to Watch: If PEP breaks above $151.33 (30D resistance), the call-heavy options market could trigger a self-fulfilling rally. But if it dips below $145.30 (intraday low), the block trade at $140 might limit further damage. The key is volume—watch for a surge in $155 call buying if the stock approaches that level.News and Market Sentiment: Rebranding vs. Margin Pressures

PepsiCo’s recent rebranding to emphasize snacks and nutrition is a big deal. It’s not just a logo change—it’s a strategic pivot to diversify beyond soda. This aligns with the call-heavy options activity, as investors bet on long-term growth. The partnership with Celsius to distribute energy drinks also adds a new revenue stream, which could juice the stock if execution is smooth.

But don’t ignore the headwinds. Rising supply chain costs and activist investor pressure (Elliott’s push to restructure bottling operations) are real risks. UBS lowering its price target to $170 reflects skepticism about near-term margins. The rebranding might take years to pay off, and the $10M block trade at $140 suggests some hedging against that uncertainty.

The Bottom Line: The news flow is mixed. Long-term bulls have reasons to cheer, but short-term bears aren’t wrong to worry. The options market is pricing in optimism, but the technicals (RSI at 43, MACD bearish) say caution is warranted.Actionable Trade Ideas: Calls, Puts, and Price Levels

Let’s get specific. For options traders, the $152.50 call (expiring next Friday) is a high-conviction play. With 772 open interest, it’s a liquid strike that’s 4% out of the money. If PEP breaks above $151.33 (resistance) and holds, this call could see significant gamma. A tighter play is the $155 call, which is 6% OTM but has 2,283 open interest—ideal if you’re betting on a breakout.

For downside protection, the $145 put (expiring next Friday) is a solid hedge. It’s 7% OTM and has 307 open interest, meaning there’s enough liquidity to avoid slippage. If PEP dips below $145.30, this put could cap losses while the block trade at $140 kicks in.

Stock traders should consider entry near $145.30 (intraday low) if support holds. A bullish target is $151.33 (30D resistance), with a stop-loss below $138.80 (lower Bollinger Band). The RSI at 43 suggests oversold territory isn’t far, but the MACD histogram (-0.54) warns of lingering bearish momentum.

Volatility on the Horizon: Balancing Bullish Bias and Caution

The next few weeks will test PEP’s resolve. The rebranding and Celsius partnership could drive a rally, but margin pressures and activist investor moves might cap upside. The options market is pricing in a 6-8% move higher, but technicals (Bollinger Bands, MACD) suggest a ranging pattern for now.

Here’s the takeaway: Position yourself with the $152.50 call for a mid-term bullish bet and the $145 put as insurance. For stock, buy on a rebound above $145.30 but keep a tight stop below $138.80. The block trade at $140 is a wildcard—it could stabilize the stock or signal deeper trouble. Either way, the options activity shows where the crowd is leaning. And in trading, the crowd isn’t always right—but it’s always worth listening to.