Amazon's $200 Put Wall and $250 Call Thirst: A Bearish Play with AI Spending Fallout

• AMZN plunges 6.8% on $200B AI capex shock, with $200 puts (OI: 26,958) forming a potential support wall
• Options market shows 0.72 put/call OI ratio, but $250 calls (OI: 31,352) hint at fading bullish bets
• Block trade buys 10,000 AMZN20260206P220 puts at $10.8M, signaling institutional bearishness

Here's the rub: Amazon's stock is tanking on a $200B AI spending bombshell, and the options market is painting a clear picture of panic. The put/call imbalance and block trades scream for short-term bearish plays, but the $250 call wall adds a twist. Let's break it down.

The $200 Put Wall vs. $250 Call Thirst

The options market is split down the middle. On the bearish side, the $200 strike (OI: 26,958) has become a magnet for fear. That’s not just noise—it’s a concrete support level where sellers are bracing for a potential bounce. But here’s the catch: the $250 call (OI: 31,352) is the most watched strike, with traders betting on a rebound. It’s like a tug-of-war between panic and hope.

Don’t ignore the block trade either. Someone just bought 10,000 AMZN20260206P220 puts for $10.8M. That’s not retail money—that’s a whale hedging a massive short position. The $220 strike is now a red flag for bulls. If AMZN breaks below $200, those puts could ignite a cascade.

AI Spending and the Investor Exodus

Amazon’s $200B AI bet sounds bold, but the market isn’t buying it. The Q1 guidance miss ($16.5B–$21.5B vs. $22.2B) and job cuts are the real story. Analysts like Gil Luria are downgrading the stock, warning AWS is losing its edge to Google and Microsoft. That explains why the $200 put wall exists—it’s not just a technical level, it’s a psychological one.

But here’s the kicker: Amazon’s free cash flow could turn negative in 2026. That’s a death knell for growth stocks. The options market is pricing in that risk, but the $250 call OI suggests some traders still think the AI gamble will pay off. It’s a dangerous bet, though—those calls could expire worthless if the stock stays below $220.

Trade Ideas: Short-Term Bearish, Long-Term Cautious

For this Friday (2/6):

• Sell to open AMZN20260206C250 calls at $1.50–$2.00. The $250 strike is a trap for bullish complacency. If AMZN closes below $220, these calls will be toast.
• Buy AMZN20260206P200 puts if the stock dips to $205–$210. The $200 level is a fortress, and a break below $200 could trigger a $180–$190 freefall.

For next Friday (2/13):

• Buy AMZN20260213P200 puts as a hedge. With the $200 OI already high, these could act as insurance if the sell-off continues.

Stock play: Short AMZN near $207.50 with a stop-loss above $215. The 200D MA at $223 is a critical resistance. If the stock holds above $215, cover the short and pivot to a bullish fade.

Volatility on the Horizon

Amazon isn’t just a stock—it’s a barometer for AI optimism. The $200B capex plan is a long-term play, but the market is punishing short-term pain. The options data and block trades suggest this selloff isn’t over. If the stock breaks the $200–$205 support zone, brace for a $180–$190 test. But don’t count out a rebound if the $200 wall holds. This is a high-risk, high-reward setup—trade with caution and keep your stops tight.