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

• PEP surges 1.73% on strong Q2 earnings and AI/digitization bets
• Options data shows 0.65 put/call OI imbalance, with heavy call OI at $150–$155 strikes
• Massive block trade sells 30K puts at $140 strike, hinting at institutional confidence

Here’s the takeaway: PEP’s options market is painting a clear picture of bullish momentum. With call open interest dominating at key resistance levels and a $10.2M block trade targeting $140 support, the setup suggests a high-probability breakout scenario. Let’s break down why this could be a golden opportunity—and where to watch for risks.

The Options Imbalance: Why $150 and $140 Matter

PEP’s options chain is a treasure map for traders. The top OTM calls for Friday expiration are clustered at $147–$155, with 700 contracts at $150 and 306 at $155. That’s not random—it’s a vote of confidence from options players who expect a push above the 30D MA of $146.73. Meanwhile, puts are piling up at $140–$142, with 1,172 contracts at $140.

The 0.65 put/call OI ratio (calls > puts) tells us the market is pricing in more upside potential. But here’s the twist: that $140 put block trade—selling 30K contracts at a $140 strike—could act as a floor. Big players are likely hedging a long position or preparing to accumulate shares if PEP dips.

News Flow: Strategic Moves vs. Analyst Caution

PepsiCo’s recent headlines are a mixed bag. The $585M Celsius investment and AI push with AWS/Salesforce signal aggressive growth, but analysts at Freedom Capital and Barclays are sticking with "Hold" ratings. That tension matters.

The block trade at $140 aligns with Pepsi’s defensive stock narrative—analysts love it for volatility. If the AI/digitization efforts translate to operational efficiency, the $140 level could become a psychological sweet spot for bargain hunters. But don’t ignore the RSI at 21.18—oversold territory often triggers rebounds… unless fundamentals sour.

Actionable Trades: Calls, Puts, and Price Levels

Let’s get specific. For options players:

• Buy PEP240927C00150000 (Friday $150 call) if PEP breaks above today’s high of $145.19. The 700 OI at this strike means liquidity and potential gamma squeeze if the move accelerates.
• Sell PEP240927P00140000 (Friday $140 put) to collect premium, given the block trade’s support.

For stock traders:

• Entry near $143.09 (200DMA) if PEP holds above $142.70 (30D support). Target $148.55 (middle Bollinger Band) as a first resistance.
• Stop-loss below $142.68 (intraday low) to protect against a breakdown.

Volatility on the Horizon: Balancing Bullish Setup and Bearish Risks

The MACD (-1.09) and RSI (21.18) scream for a rebound, but don’t ignore the long-term ranging pattern. PEP’s 200D MA at $142.39 is a critical line—break below that, and the puts at $136–$140 could ignite. Conversely, a close above $148.55 (middle BB) would validate the bullish case, with $155 calls (309 OI) in play for next Friday.

Bottom line: This is a high-conviction trade for those who believe Pepsi’s AI/digitization bets and Celsius partnership will drive growth. But keep a tight stop and watch for Elliott’s activist push—unpredictable catalysts can shake even the sturdiest charts.

PEP isn’t just a soda stock anymore. It’s a battleground for strategic bets on AI, energy drinks, and operational efficiency. The options market is already pricing in a winner’s mindset—now it’s up to the fundamentals to deliver.