AMZN Options Signal $260 Call Battle as Buyback and Earnings Fuel Bullish Setup – Here’s How to Play It

• Amazon’s Q4 earnings beat and $10B buyback boost long-term optimism
• Options data shows 2.1M call open interest at $260 strike—triple the nearest put
• Regulatory risks persist but technicals hint at $235+ rebound potential

Here’s the thing: AMZN’s options market is screaming about a potential breakout. With call open interest at the $260 strike tripling the nearest put volume, and a bullish 200-day MA crossover, this stock is primed for a directional move. But the EU fine and DOJ probe mean we need to play this with both eyes open.

The $260 Call Wall and Whale Moves

Let’s start with the elephant in the room: 61,344 open contracts at the AMZN20251219C260 strike. That’s not just noise—it’s a bet that Amazon will punch through $230 resistance. The block trade data adds intrigue: 830 puts at $240 (AMZN20251121P240) and 500 calls at $250 (AMZN20260116C250) suggest big players are hedging both directions. Think of it like a chess match—every bearish move to protect the $220 support zone is met with bullish aggression at $235-240.

The RSI at 43.8 and MACD crossing below zero signal short-term pain, but the 200D MA at $214.80 is now a critical floor. If AMZN holds above $221 (the 200D support level), the call-heavy options chain could force a gamma squeeze. But don’t ignore the puts: 25,591 open contracts at $200 (AMZN20251219P200) mean a breakdown below $220 would trigger panic selling.

Earnings, Buybacks, and the Regulatory Tightrope

Amazon’s Q4 beat and $10B buyback are textbook bullish catalysts. But the EU fine and DOJ cloud probe add a twist. Here’s the rub: while the $2.3B penalty is a headwind, the buyback alone could offset 4% of the stock’s current market cap. The new Echo Dot 5 and AWS AI expansion are revenue accelerants—just don’t expect them to offset regulatory drag overnight. Retail investors are betting on the buyback’s stabilizing effect, but institutional traders are hedging with those deep-out-of-the-money puts.

Trade Ideas: Calls, Puts, and Precision Entries

For options players, the AMZN20251219C235 strike (45,059 open contracts) is your sweet spot. If AMZN holds above $228, this call could run as the stock tests $235 resistance. For the stock itself, consider entries near $228 with a stop below $221. Targets? $235 first, then $240. If you’re bearish, a put spread between $220 and $210 (AMZN20251219P220 + AMZN20251219P210) caps risk while playing the regulatory uncertainty.

Volatility on the Horizon

This isn’t a one-way bet. The options market is pricing in a 15% move by December 19th. If AMZN gaps above $235, the $260 calls could explode. But a breakdown below $221 would validate the puts. Either way, the next 72 hours will tell us if the buyback and earnings story can outmuscle the regulatory headwinds. Stay nimble—this stock’s about to get interesting.