Costco (COST) Options Signal Key Resistance Battle – Focus on $940 Puts and $1020 Calls for Friday's Moves

Here's what's happening today with Costco:

• COST is trading at $979.46, up just under 0.5% from its previous close of $974.78.
• Options market activity shows heavy call open interest at $1020 and strong put interest at $940 for this Friday's expiry.
• A block trade of 50 contracts for the COST20260327P977.5 put shows some dark pool intrigue ahead of the weekend.

Here's the thing — right now, COST is sitting between a long-term range and a short-term bearish pattern. The options market isn’t sitting idly by. If you're watching this stock, you need to know what the puts at $940 and the calls at $1020 are telling us.

What OTM Options and Block Trades Are Telling Us

Let's break it down. The options market is heavy on puts at $940 with an open interest of 1,692 and calls at $1020 with 2,303 open interest. That’s not a coincidence. It looks like a lot of traders are either hedging or expecting a significant move — either down to support or up to test resistance.

The block trade in the COST20260327P977.5 put is interesting. A single trade of 50 puts means someone is either protecting a position or betting that the stock will drop below $977.50 by Friday. That’s close to the lower Bollinger Band at $975.12. If that level breaks, the $940 puts could see a lot of action.

On the bullish side, the $1020 call is the top call for Friday, and it’s not that far from the 30-day moving average at $995.66. But the RSI is at 35.46, meaning the stock could still bounce — or it might not. The MACD is negative and crossing below the signal line, so we’re not seeing a strong bullish signal yet.

What the Market Doesn’t Talk About — But Should

There's no major news on Costco in the last 3-4 days. But that silence is telling. No earnings, no guidance, no major announcements. The stock is trading in a vacuum — which means it’s really all about technicals and options sentiment.

That also means the market is reacting to what it expects, not what it knows. If you're a retail investor, this can be dangerous. Without news, the stock can swing on momentum alone — and right now, that momentum is mixed. The long-term trend is range-bound, but the short-term looks like it’s preparing for a breakout or breakdown.

Here Are the Best Options and Stock Plays for Friday and Next Week

Option Play #1: Buy the COST20260327P940 for Friday. Why? Because that’s where the put interest is, and with the stock hovering around $979, the $940 put is about 4% OTM. If Costco slips under $975 — which is already a psychological level — this could be a strong short-term play.

Option Play #2: Consider the COST20260327C1020 as a directional trade. It’s OTM but not out of reach. If the stock breaks above the 30-day MA and tests the upper Bollinger Band, this could be a low-risk call to play the breakout.

Stock Play: If you're a swing trader, look to enter near $975 if the stock holds. That’s the lower Bollinger Band and a strong psychological level. If it breaks below, consider a target near $940 as a potential stop or sell zone. If it holds above $975 and bounces, look for a potential rally to $1010–$1020 as the next major resistance area.

Volatility on the Horizon — What to Watch

There's a clear battle happening at the moment — between the bears expecting a drop to $940 and the bulls trying to push the stock into $1020 territory. The market isn’t giving a clear winner yet, but it’s preparing for a direction.

If you're holding long-term, don’t get too shaken by Friday’s volatility. But for traders looking to capitalize on short-term moves, now is the time to decide where you stand.

Bottom line: Costco is on the edge of a decision — up or down. The options market is already betting. You might want to make your move before the crowd does.