BRK.B Options Signal Bullish Bias: Key Call Strangles at $510 and $515 as Abel Era Begins – Here’s How to Play It

• Call open interest dominates at $505–$515 strikes, with 1943 contracts at $510 (next Friday expiry).
• Block trades hint at hedging via deep puts ($460–$455 OI: 2029/2017), but calls outpace puts 2:1 in open interest.
• Technical setup shows price clinging to 200D MA ($498.20) while RSI (53.4) and MACD (-0.24 hist) suggest consolidation.

Here’s the thing: BRK.B’s options market is whispering bullish—but with a side of caution. The call/put ratio (0.54) leans heavily toward buyers, yet those puts at $460 are like a safety net for the unexpected. Let’s dig into why this matters for your strategy.

What the Options Chain Reveals About Market Sentiment

The OTM call stack at $505–$515 (especially 1943 contracts at $510 next Friday) screams "price discovery ahead." Think of it like a crowd of traders betting the stock will test those levels before January. Meanwhile, the block trades—massive puts at $460 and $455—hint at institutional hedging. It’s not panic, but it’s not complacency either.

Here’s the rub: If BRK.B breaks above the 30D support/resistance cluster ($503.99–$504.46), those calls could ignite. But watch the $490–$495 puts; if open interest there spikes, it might signal a shift in sentiment. The MACD histogram’s negative drag (-0.24) warns of short-term fatigue, but RSI isn’t overbought yet—so there’s room to run.

News Flow: Leadership Transition Fuels Stability, Not Chaos

Greg Abel’s takeover isn’t shaking the market. The news about Buffett’s "succession discount" has already been priced in—shares are trading near 1.6x book value, a discount to historical averages. Analysts are betting Abel will stick to the playbook: disciplined capital allocation, decentralized operations, and a focus on Berkshire’s $381B cash hoard.

But here’s the twist: The block trades at $460–$455 (expiring Sept 19, 2025) suggest some players are prepping for a worst-case scenario. Maybe they’re hedging against a market correction or a stumble in Abel’s early moves. Either way, the news isn’t a red flag—it’s a green light for long-term positioning.

Actionable Trade Ideas: Calls for Conviction, Puts for CautionFor Options Traders:

• Bullish Play: Buy BRKB20260109C510 (next Friday expiry). Why? The $510 strike has 1943 OI and sits just below the upper Bollinger Band ($510.26). If BRK.B holds above $500.52 (middle band), this call could catch a pop.
• Bearish Hedge: Sell a put spread at BRKB20260109P495 (773 OI) and buy BRKB20260109P490 (624 OI). The $5 range caps risk while capitalizing on the 200D MA’s support.

For Stock Traders:

• Entry: Consider buying near $498.20 (200D MA) if price holds above $495. The 30D MA at $502.49 acts as a secondary target.
• Exit: Aim for $510.26 (upper Bollinger Band) or $515 (call-heavy zone). Trail stops below $500.33 (intraday low) to lock in gains.

Volatility on the Horizon: Balancing Leadership and Liquidity

Bridging the gap between Buffett’s legacy and Abel’s future, BRK.B sits at a crossroads. The options market isn’t screaming for a breakout, but it’s not bracing for a breakdown either. With the stock trading in a tight range and calls outpacing puts, the path of least resistance is sideways-to-up.

But don’t ignore the puts. That $460–$455 block trade? It’s like a weather vane for macro risks—geopolitical shocks, rate hikes, or a stumble in Berkshire’s insurance underwriting. If those puts start ticking up, it’s a signal to tighten stops or hedge.

Bottom line: This is a stock built for the long game. The options data and news both point to stability. For now, play the probabilities—back the bulls with calls at $510, but keep a weather eye on those deep puts. The market isn’t betting on a crash, but it’s not ignoring the possibility either.