Costco (COST) Options Signal Bullish Bias: Key Strikes and Trade Setups for Dec 26, 2025

• Costco’s price action nudged higher today, trading at $872.89 with a 0.12% gain, but remains below its 30D and 200D moving averages.
• Options market sentiment leans bullish: Call open interest (OI) outpaces puts 1.3:1, with heavy concentration at the $900 and $875 call strikes.
• Technical indicators show an oversold RSI (37.27) and a bearish MACD (-14.33), hinting at a potential short-term rebound.

Here’s the thing: Costco’s options market is painting a clear picture. Traders are betting on a near-term rebound, but the long-term technicals and valuation risks still linger. Let’s break it down.

Bullish Call Dominance and Whale Moves at Key Strikes

Options data tells a story of cautious optimism. The COST20251226C900 and COST20251226C875 calls lead this Friday’s open interest, with 1,701 and 1,243 contracts outstanding. That’s not just noise—it’s a sign that traders expect a push above $883.07 (Bollinger middle band) before expiration.

But don’t ignore the puts. The COST20251226P830 put leads with 1,186 OI, acting like a floor for downside risk. It’s a classic “buy the dip” setup—if the stock cracks below $869.0 (intraday low), that strike could see action.

There’s also a whale move to note: A block trade sold COST20250926P942.5 puts for $984,000. That’s a bet the stock won’t collapse below $942.50 by September. It suggests institutional confidence in Costco’s ability to hold its membership-driven moat, even if the long-term trend is bearish.

Company News: Earnings Optimism vs. Valuation Concerns

Costco’s fundamentals are mixed. The Q4 2025 EPS guidance of $4.49 (+11.7% YoY) and 35 new warehouse plans for 2026 are bullish. Analysts like Northcoast Research and Goldman Sachs have raised price targets to $926–$1,171, betting on membership fee hikes and international expansion.

But here’s the catch: The stock trades at a 45.8x P/E, a premium to peers. The Zacks Rank “Hold” and oversold RSI (37.27) suggest a rebound is possible, but valuation compression could cap gains. If the market discounts these risks, the $900 call strikes might struggle to justify their premiums.

Actionable Trade Ideas for Today

For options traders, the COST20260102C900 call (next Friday’s $900 strike) is a setup to watch. If Costco breaks above $883.07 (middle Bollinger band) with volume, this strike could gain steam. A tighter play: The COST20251226C875 call if the stock holds its 30D support at $854.50.

For stock buyers, consider entry near $854.50–$856.00 (30D support). A successful rebound would target $883.07 first, then $900. A stop below $869.0 would invalidate the bullish case.

Bearish players could eye the COST20260102P845 put if Costco dips below $870. The RSI’s oversold reading and block trade at $942.50 suggest a rebound is likely—but not guaranteed.

Volatility on the Horizon

Costco’s story is a tug-of-war: Strong membership economics and expansion plans vs. stretched valuations and a bearish 200D trend. The options market is pricing in a near-term bounce, but long-term investors should watch the $951.70 200D MA as a critical resistance. If the stock can’t break above that, the bearish MACD and declining moving averages will take over.

Bottom line: Today’s options setup favors bulls, but don’t ignore the structural headwinds. Play the short-term rebound with tight stops, and keep an eye on Q4 earnings in January. The market’s verdict? It’s written in the options chain.