Amazon’s Options Signal Bullish Bias: Key Strikes and Block Trades Point to $235+ Upside Potential

• AMZN trades at $232.50, perched above its 30D support/resistance zone ($229.05–$229.59) and below its 200D MA ($216.15).
• Options data shows a 0.72 put/call open interest ratio, with heavy call OI at $235 and $240 strikes, and block trades hinting at institutional bullishness.
• Q3 earnings beat, AI-driven AWS growth, and regulatory settlements mix with insider sales and antitrust risks.

Here’s the core insight: Amazon’s options market is pricing in a strong bias for a $235+ breakout—but with a shadow of caution from regulatory and insider selling pressures. The stock’s technicals and options activity align for a short-term bullish push, though risks linger below $225.

Bullish Sentiment in Options and Block Trades

The options chain tells a clear story: call open interest dominates, especially at the $235 and $240 strikes (35,915 and 17,615 contracts, respectively). These strikes act like a "crowd-sourced target" for where traders expect AMZN to rally. Meanwhile, put OI is concentrated at lower strikes ($230, $222.50), suggesting limited downside conviction.

Block trades add intrigue. A 500-lot AMZN20260116C250 call purchase (expiring Jan 16) signals a big bet on a $250+ move. Conversely, a 830-lot AMZN20251121P240 put sale (expiring Nov 21) hints at hedging or profit-taking. The mix of bullish calls and defensive puts reflects a market bracing for volatility but leaning long.

News Flow: AI Growth vs. Regulatory Headwinds

Amazon’s Q3 earnings beat ($1.95/share) and 13% revenue growth—driven by AWS and AI tools—back the bullish case. Institutional buyers like Flputnam (up 13.6% stake) and Citadel (selling 1.6M shares to buy AI stocks) show mixed signals. But here’s the catch: regulatory settlements and antitrust investigations remain a drag. The EU’s Digital Markets Act demands concessions on how Amazon promotes its own products, and the recent AWS outage raises reliability concerns.

Investor sentiment is split. While AI integrations for Alexa and healthcare bets excite growth bulls, insider sales (like CEO Garman’s 73.9% stake reduction) and a 32.8 P/E ratio suggest some caution. The key question: Can Amazon’s AI-driven margins offset regulatory drag?

Actionable Trading SetupsFor Options Traders:

• Bullish Play: Buy the AMZN20260102C235 call (expiring Jan 2) if AMZN breaks above its intraday high of $232.82. Target $235–$240, where heavy OI could create a self-fulfilling rally.
• Bearish Hedge: Sell the AMZN20260102P225 put (OI: 7,515) if the stock dips to $229.05 (30D support). This creates a put spread if AMZN holds above $225.

For Stock Traders:

• Entry Near $232.50: If AMZN holds above its 30D MA ($228.89), consider buying on dips to $229.50 (midpoint of 30D support/resistance). Target $235–$237.50, with a stop-loss below $225.
• Short-Term Exit: Book partial profits at $237.50 (a key call OI strike) to lock in gains if the rally stalls.

Volatility on the Horizon: Positioning for Amazon’s 2026 AI-Driven Push

Amazon’s options and fundamentals point to a stock primed for a $235+ breakout in early 2026, fueled by AWS AI growth and institutional buying. But don’t ignore the risks: regulatory pressures and insider selling could trigger a pullback to $221–$222 (200D support). The key is to balance aggression with caution—use the $235 call OI as a guide for upside potential, but hedge with short-term puts if the stock dips.

Bottom line: This is a stock where the AI narrative is strong, but execution risks remain. Position accordingly.