Alphabet (GOOGL) Options Signal Bullish Bias: Target $340+ as AI Deal Catalyst Fuels Momentum

• Alphabet (GOOGL) trades at $332.36, down 1.04% intraday but remains above all major moving averages.
• Options market shows heavy call open interest at $350 and $340 strikes, while puts dominate at $300 and $200 levels.
• New $4 trillion market cap and Apple’s Gemini AI partnership position GOOGL as a key AI infrastructure play.

Here’s the takeaway: upside potential is strong, but short-term volatility looms. The options market is pricing in a bullish bias, with technicals and news aligning for a breakout above $337.65—Alphabet’s Bollinger Band upper boundary. Let’s break down why this matters for traders today.

Bullish Sentiment Locked in Call Options, But Puts Signal Caution

The options chain tells a story of cautious optimism. For Friday’s expiration (2026-01-16), the $350 call (GOOGL20260116C350) has 30,800 open contracts—the highest of any strike. That’s not just noise: it suggests institutional players are hedging or speculating on a push toward $350. Meanwhile, the $300 put (GOOGL20260116P300) dominates with 40,623 open contracts, acting as a floor many market participants expect before capitulation sets in.

But here’s the twist: the put/call ratio for open interest is 0.84, favoring calls. That’s a subtle bullish signal, but the heavy put activity at $200–$310 strikes (like the $260 put with 25,047 OI) shows some hedging against a sharp drop. No major block trades today, so no whale moves to worry about—yet.

Apple’s AI Bet Validates Alphabet’s AI Supremacy

The recent Apple-Gemini deal isn’t just a headline—it’s a validation of Alphabet’s AI infrastructure. Munro Partners’ Q4 investor letter already highlighted GOOGL as a top performer, and this partnership cements its role in powering Apple’s AI future. With $120B+ in cash and 25–30% operating margins, Alphabet’s fundamentals are robust. But don’t ignore the risks: regulatory scrutiny in ad tech and potential competition from AI-driven search engines could dampen momentum if ignored.

Actionable Trades: Calls for Breakouts, Puts for Protection

For options traders, the GOOGL20260123C340 call (next Friday’s $340 strike) is a prime candidate. If GOOGL breaks above $337.65 (Bollinger Band upper), this strike could see explosive gains. For a conservative play, consider a bull call spread using the $335 call (GOOGL20260123C335) and $345 call, capping risk while targeting a 3–5% move.

Stock traders should watch $313.20 (30D support). If GOOGL holds here, consider entries near $315 with a target at $340. A stop-loss below $310 would protect against a breakdown. For downside hedges, the GOOGL20260123P310 put offers protection if the stock dips toward 200D support at $175–$179 (unlikely, but worth noting).

Volatility on the Horizon: Positioning for Alphabet’s AI-Powered Ascent

Alphabet’s technicals, options flow, and news all point to a stock primed for a breakout. The $340–$350 range is the next battleground, with AI-driven growth and Apple’s partnership as tailwinds. That said, don’t ignore the puts at $300 and $200—market participants are bracing for a potential pullback. Your best bet? Ride the bullish momentum with calls or a long stock position near support, while using puts to hedge against a rare but possible overcorrection. The AI train is leaving the station—don’t miss the ride.