Berkshire Hathaway (BRK.B) Options Signal Bullish Bias: Key Strike Levels and Cash Reserves Drive Strategic Opportunities

• Berkshire Hathaway B (BRK.B) trades at $491.38, showing a 0.53% intraday gain amid a short-term bullish trend.
• Options data reveals heavy call open interest at the $500 strike for Friday expiration, while block trades hint at bearish hedging above $520.
• Buffett’s $382 billion cash hoard and Q3 earnings surge suggest a cautious yet resilient market narrative.

Here’s the core insight: BRK.B’s options market is leaning bullish, with call dominance at key strikes and technicals pointing to a potential breakout above $500. But don’t ignore the shadow of large block trades—those could signal a sudden shift in sentiment.

Bullish Sentiment, Bearish Safeguards: Decoding the Options Imbalance

Let’s start with the numbers. The top OTM call options for Friday expiration are clustered at $500 (OI: 3,530), $497.5 (OI: 2,384), and $495 (OI: 2,346). That’s a clear signal: traders are betting on a price push above $500. The put/call ratio of 0.60 (calls outweighing puts) reinforces this bullish bias. But here’s the twist—block trades are piling into puts with strikes above the current price. For example, the BRKB20250919P525 put (expiring Sept 2025) saw massive trades at $525, a level 3% above today’s price. Why would big players buy puts so far out of the money? It’s a classic hedge: they’re protecting against a sudden reversal if Buffett’s exit or market jitters trigger a selloff.

The risk? If BRK.B fails to break above $500, the heavy call open interest could collapse, dragging the stock lower. But the RSI at 50 and Bollinger Bands suggest the stock is in a tight trading range—so a breakout attempt is more likely than a crash.

Buffett’s Cash Hoard: A Bullish Narrative or a Bearish Warning?

Warren Buffett’s recent moves—selling $6.1 billion in stocks and building a $382 billion cash reserve—have traders split. On one hand, it’s a sign of caution. On the other, it’s a strategic move to capitalize on undervalued assets later. The Q3 earnings report (up 17.31% to $30.8 billion) and strong insurance results add credibility to the bullish case. But here’s the catch: Buffett’s exit looms. As Bloomberg notes, his departure could shift Berkshire’s investment DNA, and that uncertainty is already priced into the stock.

The news flow isn’t a red flag—it’s a yellow one. Investors are hedging against volatility, not fleeing. The block trades at $525 puts? They’re not panic—they’re preparation. Think of it like a storm: you see umbrellas coming out before the rain hits.

Actionable Trade Ideas: Calls for Breakouts, Puts for Protection

For options traders, the BRKB240920C500 call (expiring this Friday) is a high-conviction play. With open interest at 3,530, it’s the most liquid strike. If BRK.B closes above $500, this call could see a 10–15% move. For a safer bet, consider the BRKB240927C500 (next Friday’s expiration). It’s cheaper (OI: 2,683) and gives the stock more time to rally.

On the bearish side, the BRKB240920P490 put (OI: 3,388) is a defensive play. If the stock dips below $488.67 (30D support), this put could cap losses. But don’t overcommit—Bollinger Bands show the lower bound at $474.64, so a drop below $485 would be a red flag.

For stock traders, entry near $488.67 (support level) is ideal if the RSI holds above 45. A breakout above $491.39 (200D resistance) would validate the bullish case, with a target at $500. If the stock fails to hold above $486.75 (intraday low), consider exiting or hedging with the BRKB240920P485 put.

Volatility on the Horizon: Balancing Bullish Momentum and Bearish Safeguards

The key takeaway? BRK.B is in a tight range, but options data and technicals lean toward a bullish breakout. The heavy call open interest at $500 and strong earnings suggest a push higher is likely—but don’t ignore the block trades. Those $525 puts are a reminder that big players are bracing for a storm. Your best bet? Ride the bullish wave with calls at $500, but keep a short-term put hedge in case Buffett’s exit shakes things up. The market isn’t screaming “buy” or “sell”—it’s whispering “wait and watch.” And right now, the whispers are leaning up.