Amazon (AMZN) Options Signal Bullish Bias: Key Strikes and Block Trades Point to Strategic Entry Zones

Amazon’s price drop today masks a bullish options setup. The stock trades at $237.05, down 2.29% from its 52-week high, but options activity and technicals suggest a potential rebound. Here’s what traders need to know:

• Options sentiment is skewed bullish: Call open interest dominates, especially at $250 and $240 strikes.
• Block trades hint at institutional positioning: A $2000-lot put buy and a $1000-lot call trade stand out.
• Technical indicators remain intact: RSI at 69.3 and bullish moving averages suggest resilience.

The big picture? The market is pricing in a short-term pullback but expects a rebound above $232 support. Let’s break it down.Bullish Options Pressure and Whale Moves

The options chain tells a clear story: traders are betting on a rebound. For Friday expiration (Jan 16), the AMZN20260116C250 call has 62,258 open contracts—nearly double the nearest put’s open interest. This suggests aggressive buying at strikes 12% above current price. Meanwhile, the AMZN20260116P225 put has 27,689 open contracts, showing hedging activity at 11% below today’s price.

But it’s the block trades that catch attention. A AMZN20260320P220 put was bought in a $1.34M block—likely institutional hedging ahead of March. Separately, a AMZN20260116C237.5 call saw a $356K trade, possibly signaling confidence in a near-term rebound. These moves imply a "buy the dip" mindset, but don’t ignore the 221–222 support zone from 200D moving averages—it’s a critical line in the sand.

News Flow: Analysts Split, But AI Narrative Holds

Cantor Fitzgerald cut its price target to $260 from $315, while Jefferies raised theirs to $300. Both firms agree on Amazon’s AI-driven cloud growth—AWS remains a cash cow. The market’s reaction? It’s already priced in the Cantor cut (price dropped 2.3% today), but Jefferies’ optimism might fuel a rebound. Think of it like a seesaw: bad news is digested, but the long-term AI story keeps the floor from crumbling.

Actionable Trade IdeasFor options traders: Target the AMZN20260123C250 (next Friday expiration) if price breaks above $237.50. This call has 11,379 open contracts and sits at a key psychological level. For downside protection, the AMZN20260123P225 offers a 11% buffer if volatility spikes. Avoid the $300 calls—they’re too far OTM for today’s move.For stock traders: Consider entries near $232 (30D MA support) with a target at $240. If the price holds above $221 (200D MA), it could rally to test $250. A stop below $221 would signal a deeper correction—exit or hedge there.Volatility on the Horizon

Amazon isn’t out of the woods. The 0.75 put/call ratio shows bears aren’t out of the game, and the Bollinger Bands suggest a 7% range between $216 and $249. But with AI tailwinds and a strong balance sheet, this dip could be a buying opportunity. Keep an eye on next week’s AWS earnings—another catalyst could tip the scales.