Bullish Momentum Unfolds in BRK.B as Call Open Interest Surges at $510—Here’s How to Position for the Upcoming Move

• BRK.B trades at $497.11, down 0.53% from its 52-week high of $500.28, but shows a short-term bullish engulfing pattern.
• Options data highlights: Call open interest spikes at $510 (next Friday’s $22,023 OI), while puts cluster at $460–$490, signaling a call-heavy bias.
• News-driven catalysts: Buffett’s healthcare bets and OxyChem acquisition align with long-term bullish fundamentals.

The market is whispering a breakout. BRK.B’s price action and options flow suggest a battle for control above $500—here’s how to read the signals.

What the Options Chain Reveals About Market Sentiment

The next Friday options chain tells a clear story: call open interest at $510 (BRK.B20260116C510) dwarfs other strikes, with 22,023 contracts outstanding. This isn’t just noise—it’s a vote of confidence from institutional players. Meanwhile, puts at $490 (BRK.B20260116P490) with 5,286 OI hint at a floor around $490, but the call/put ratio of 0.56 (favoring calls) suggests the crowd is leaning long.

No major block trades skewed the action today, but the sheer volume of call OI at $510 implies a potential target level. Think of it like a magnet: if BRK.B breaks above $500, those $510 calls could act as a gravity point. The risk? A pullback below $492.19 (lower Bollinger Band) could trigger short-term pain.

News Flow: Buffett’s Moves Signal Strategic Shift, Not Panic

Berkshire’s recent bets on UnitedHealth and OxyChem scream "long-term value," not a flight to safety. Buffett’s criticism of the Kraft Heinz split and his planned succession to Greg Abel add nuance. While the leadership transition might cause a brief wobble, Abel’s track record as COO suggests continuity. The insurance deals with First Brands also highlight Berkshire’s role as a risk manager—something retail traders can mirror with options.

Here’s the catch: Buffett’s bearish take on Kraft Heinz could ripple into broader market skepticism about conglomerates. But for BRK.B itself, the news reinforces its industrial and healthcare diversification—a tailwind for stability.

Actionable Trade Ideas: Calls for the Breakout, Puts for the Floor

1. If you’re bullish: Buy BRK.B20260116C510 (next Friday’s $510 calls). Why? The $510 strike is the most contested call level, and a close above $500 could ignite momentum. Target a $515–$520 move to justify the premium.
2. If you’re cautious: A bear put spread using BRK.B20260116P490 and BRK.B20260116P480 could cap losses if the stock dips below $492.19. The $490 strike has 5,286 OI, offering liquidity if you need to adjust.
3. Stock traders: Consider entries near $492.19 (lower Bollinger Band) with a tight stop below $490. If the 30D MA at $506.33 holds, aim for a $506–$508 target. Avoid chasing above $500 unless volume surges.

Volatility on the Horizon: Balancing Optimism and Caution

BRK.B isn’t screaming for a breakout—it’s whispering. The technicals and options flow agree: a test of $506.33 (30D MA) is imminent. If bulls hold the $499.60 middle Bollinger Band, the $510 calls could be your best bet. But don’t ignore the puts at $490–$460—they’re there for a reason. This isn’t a one-way bet; it’s a tightrope walk between Buffett’s legacy and the next chapter under Abel. Stay nimble, and let the data guide your next move.