HD Options Signal Bullish Bias at $357.5 Strike—Here’s How to Play the Rebound

• The Home Depot (HD) is up 4.18% today, trading at $350.64, with RSI at 21 (oversold) and MACD trending lower.
• Options market shows call-heavy bias: 2,875 open interest at the $357.5 call (this Friday’s expiry) vs. 2,052 puts at $310.
• Company news: Q3 earnings miss and revised guidance, but options data hints at a short-term rebound trade.
• Key takeaway: A bearish technical setup clashes with bullish options positioning—traders are betting on a bounce above $351.43.

The options market is whispering ‘buy the dip’—but is it a trap or an opportunity?Bullish Bets vs. Bearish Technicals: Decoding the Options Imbalance

The options chain tells a story of divided sentiment. For this Friday’s expiry (2025-11-28), the $357.5 call has the highest open interest (2,875 contracts), suggesting traders are eyeing a rebound above the 30-day support level of $366.98. Meanwhile, the $310 put (2,052 OI) acts as a safety net for those bracing for a breakdown below the $328.89 Bollinger Band.

But here’s the twist: the put/call ratio for open interest is 0.82, meaning more capital is allocated to calls than puts. This isn’t just noise—it’s a signal that institutional players are hedging for a short-term rally, not a prolonged selloff. The absence of block trades (no whale-sized orders) means this is retail-driven optimism… for now.

Company News: A Storm Cloud with a Silver Lining

Home Depot’s Q3 report was a mixed bag. Earnings missed estimates for the third straight quarter, and guidance was slashed due to weak consumer demand and lack of storm activity. Yet the stock is up 4% today. Why?

The market is pricing in a rebound narrative. The $3.6B in net earnings and 11% online sales growth (despite the miss) show resilience. Traders are betting that the worst is priced in—and that the $357.5 call strike aligns with a psychological hurdle: breaking above this level could trigger a retest of the 30-day MA at $372.23.

Actionable Trades: Calls for the Rebound, Puts for the Safety NetFor Options Traders:

• Aggressive Play: Buy the HD 2025-11-28 C 357.5 if HD closes above $351.43 today. With RSI at 21, a break above this strike could trigger a rally toward $366 (200D MA) and $385 (key resistance).
• Conservative Play: Sell the HD 2025-12-05 P 335 to collect premium. The $335 put is a popular downside hedge, and with the stock trading at $350, it’s a low-risk way to profit if HD holds above $338.85.

For Stock Traders:

• Entry: Consider buying HD near $345 if it pulls back to the Bollinger Band’s lower bound ($328.89 is too far). A close above $351.43 validates the bullish case.
• Targets: First target is $366 (200D MA), then $385 (30D resistance). Stop loss below $338.85 (intraday low).

Volatility on the Horizon: What to Watch

The next 72 hours will be critical. If HD closes above $351.43 today, the $357.5 call could become a catalyst for a short-term rally. But if it fails to hold above $345, the $335 put could see a surge in buying.

This is a high-conviction trade for those comfortable with volatility. The key is to balance the bullish options positioning with the bearish technicals—use the $335 put as insurance if you’re long the stock, or pair the $357.5 call with a short $375 call (next Friday’s expiry) to create a bullish vertical spread.

Final Takeaway: The Home Depot’s options market is a tug-of-war between bearish fundamentals and bullish positioning. For traders, the sweet spot lies in exploiting this dislocation—whether through a well-timed call buy or a strategic put hedge. The next few days will tell if this is a setup for a rebound or a trap for the overoptimistic.