Alphabet (GOOG) Options Signal $350 Bullish Battle: How to Play the AI-Driven Breakout Amid Volatility

• GOOG plunges 1.18% to $329.23, breaking below 30D support at $315.71
• Options market shows 34% more open interest in calls than puts, with heavy call OI at $350 strike
• Block trade of 2,000 puts at $310 hints at strategic hedging ahead of Feb expiration

Here's the thing: GOOG's price action and options positioning tell two conflicting stories. The stock is testing key support while options traders are aggressively buying calls above $340—like they're preparing for a war at $350. Let's break down what this means for your strategy.

Where the Money Is Flowing: Calls at $350, Puts at $310

The options chain is screaming about two critical price levels. For this Friday's expiration, 25,015 contracts are open at the $350 call strike—nearly double the next highest call. That's not just noise; it's a crowd of traders betting on a rebound above $350. Meanwhile, the $165 put strike has 18,500 open contracts, an absurdly low strike that suggests some institutional players are hedging extreme downside scenarios.

But here's the twist: A block trade of 2,000 puts at $310 (expiring Feb 20) just got added to the mix. That's right in the 200D support range ($313.64–$317.45). Think of it like a big bet that GOOG won't fall below $310 in the next month. If you're short-term bullish but cautious, this signals where to set your guardrails.

AI Hype vs. Institutional Exit Strategy

Alphabet's recent news is a mixed bag. The Apple partnership and Gemini 3 launch are fueling AI hype, but the State of Alaska's 3.2% stake reduction and director's $202k sale show not everyone's all-in. Here's the rub: The market is pricing in AI dominance, but institutional players are trimming positions after hitting $4 trillion market cap. This creates a tug-of-war—retail traders love the AI narrative, while pros are taking profits.

The class-action lawsuit over AI training data adds a wildcard. If that blows up, the $310 block trade might get tested. But with RBC raising its price target to $375, the bulls aren't backing down.

Your Playbook: Calls at $340, Puts at $327.50

For options traders:

• Bullish play: Buy GOOG20260116C340 (this Friday's $340 call). With the stock at $329, this gives you a 3% buffer if price bounces. The 15,480 open contracts mean liquidity won't be an issue.
• Bearish hedge: Buy GOOG20260123P327.50 (next Friday's $327.50 put). The 10,728 open puts at this strike show smart money is bracing for a test of Bollinger Bands' lower bound ($297.51).

For stock traders:

• Entry near $315.71 if support holds. Set a stop-loss below $313.64 (200D support).
• Target zone: $340–$350 if the call buyers are right. But watch the $335 level—the 8,489 open calls there could push price higher if it breaks.

Volatility on the Horizon

The next 72 hours will be critical. If GOOG closes above $335 tomorrow, the $350 call buyers could trigger a short-covering rally. But if it falls below $325, the $327.50 put buyers might step in. Either way, the options market has already priced in a $300–$370 trading range by Feb. This isn't a binary bet—it's a chess game where your move depends on who blinks first at $350 or $310.

Remember: The RSI at 76 means overbought conditions are here, but the 15.9% YoY revenue growth and AI momentum suggest this isn't a typical top. Your best bet? Ride the $340–$350 corridor with tight stops, and keep an eye on that Feb 20 block trade—it might just tell you when the bulls or bears throw in the towel.