Amazon (AMZN) Options Signal Bullish Bias: Key Strike Levels and Trade Setups for 2026

• AMZN’s price dropped 1.8% to $226.68, pressured by a bearish engulfing candle but still above critical 200D support at $221.61.
• Call open interest dominates (put/call ratio: 0.74), with heavy demand at $235 and $240 strikes ahead of Friday’s expiry.
• Block trades hint at big money moves: A $480K buy of AMZN20260116C250 and a $1.35M put trade at AMZN20251121P240 signal strategic positioning.

The options market is whispering a bullish story, but the stock’s short-term chart warns of a potential trap. Let’s break it down.Bullish Sentiment Locked in at $235–$240, But Puts Signal Caution

The options chain shows a clear imbalance: call open interest is 33% higher than puts, with the most attention at $235 (24,571 contracts) and $240 (18,229). This suggests traders are pricing in a rebound above $230, the 30D support level. But don’t ignore the puts: $215 and $220 strikes have 7,393 and 6,255 open contracts, respectively. That’s not just noise—it’s a hedge against the EU fine and labor lawsuit risks.

The block trades add intrigue. A $480K buy of AMZN20260116C250 (expiring Jan 16) implies someone’s eyeing a sharp rally. Meanwhile, the $1.35M AMZN20251121P240 trade (expiring Nov 21, 2025) hints at long-term bearish positioning. The message? Short-term bulls are active, but macro risks linger.

News Flow: A Mixed Bag for AMZN’s Narrative

Amazon’s recent headlines are a rollercoaster. The $125B Q4 revenue and $10B buyback are tailwinds, but the $2.5B EU fine and labor lawsuit could drag on sentiment. Here’s the catch: the stock’s 200D moving average ($216.86) and Bollinger Bands (lower at $221.61) still act as strong supports. If the price holds above $225, the bullish case for AWS growth and AI-driven logistics gains steam. But a break below $220 would force a reevaluation of the long-term trend.

Trade Setups: Calls for the Bold, Puts for the PragmaticFor options traders:

• Bullish play: Buy AMZN20260116C235 (Jan 16 expiry). With the stock trading near $226.68, this strike offers leverage if the price rebounds above $230. The RSI at 48 suggests oversold conditions, and the 30D support at $232.35 could act as a catalyst.
• Bearish hedge: Buy AMZN20260116P225 (Jan 16 expiry). If the EU fine or lawsuit triggers a gap down, this put offers protection below $225, where the 100D MA ($228.42) and 30D MA ($228.17) start to lose relevance.

For stock traders:

• Entry near $225–$228 if the price holds above the 200D MA. Target $235–$240 if the 30D support holds.
• Stop-loss below $221.61 (lower Bollinger Band) to avoid a breakdown into the 200D support zone.

Volatility on the Horizon: Balancing Optimism and Risk

Amazon’s options market is a tug-of-war between short-term optimism and long-term caution. The bullish fundamentals—AWS growth, AI automation, and a $10B buyback—are hard to ignore. But the EU fine, lawsuit, and regulatory scrutiny add a layer of uncertainty.

Here’s the takeaway: If you’re bullish, use the current pullback as a setup for a call trade with tight stops. If you’re bearish, the puts at $220–$225 offer a safety net. Either way, keep an eye on the $228.77 middle Bollinger Band—a break above could reignite the long-term uptrend, while a drop below $221.61 would signal a deeper correction.

The market is pricing in a rebound, but the path won’t be smooth. Stay nimble, and let the data guide your next move.