Home Depot (HD) Options Signal Bullish Bias: Target $370 Call Plays Amid Ranging Volatility

• Home Depot (HD) trades at $354.43, up 0.93% intraday, with a 30-day moving average at $364.23 acting as near-term resistance.
• Options data shows heavy call open interest at $370 (1,347 contracts) and $367.50 (2,258 contracts) for Friday’s expiry, while puts at $350 dominate bearish positioning.
• Analysts at UBS and Oppenheimer highlight long-term growth potential from professional channel expansion, but near-term risks include rising costs and sector competition.

Here’s the core insight: Options market sentiment leans bullish on a breakout above $365, but technicals suggest HD is range-bound for now. The key question is whether the $370 call-heavy positioning will act as a self-fulfilling prophecy or fade into noise.

Bullish Calls at $370 Signal a Price Target, But Watch the $350 Floor

The options chain tells a story of cautious optimism. For this Friday’s expiry, 2,258 contracts of the $367.50 call and 1,851 of the $370 call are open—strikes that align with the upper Bollinger Band at $382.15. This isn’t just random buying; it’s a vote of confidence that HD could test those levels before year-end. Meanwhile, the $350 put (1,473 open interest) acts as a psychological floor. If HD dips below $349.525 (intraday low), that strike could become a magnet for short-term buyers.

Block trading is quiet today, which means no whale-sized bets are distorting the market. But the put/call ratio of 0.837 (favoring calls) suggests retail and institutional players are more bullish than bearish. The risk? If HD fails to break above $365 (middle Bollinger Band), the rally could fizzle, leaving call buyers with losses.

News Flow: Strategic Moves Offset Near-Term Headwinds

Home Depot’s recent partnership with Instacart for Canadian same-day delivery is a smart play to capture holiday demand, but the stock’s 8.33% drop over 30 days shows investors are skeptical about execution. Analysts like UBS remain bullish on the professional channel growth, but Oppenheimer’s lowered $405 price target (from $420) reflects caution about margin pressures. The competitor’s Chapter 11 filing adds a wildcard—HD could gain market share, but rising interest rates might dampen consumer spending.

The key takeaway? The news isn’t a green light for a breakout—it’s a reminder that HD’s long-term story hinges on Pro customer retention and supply chain efficiency. If those initiatives deliver, the $403.36 fair value estimate from analysts could materialize. But for now, the stock is dancing between $329 and $382, with no clear trend.

Actionable Trade Ideas: Calls for Leverage, Puts for Protection

For options traders:

• Buy HD20251212C370 (next Friday’s expiry) if HD closes above $355 today. The $370 strike is a sweet spot—high enough to offer leverage, but not so far out that it’s a gamble.
• Sell HD20251212P350 to hedge downside risk. With 1,238 open puts at that strike, there’s liquidity to exit if HD dips.

For stock traders:

• Enter long near $352 (just above the 200D MA at $366.98) with a stop below $349.525. Target $370 if the $365 level holds.
• Consider a put spread if HD drops to $350: Buy HD20251212P350 and sell HD20251212P340 for a defined-risk play on a rebound.

Volatility on the Horizon: Patience is Key

HD’s technicals and options data paint a mixed picture. The short-term RSI at 40.4 suggests oversold conditions, but the 200D MA is a heavy bearish cloud. The best strategy? Watch for a breakout above $365 or a breakdown below $349. Until then, the $350–$370 range is where the action lives. If you’re bullish, the $370 calls offer a high-risk, high-reward play. If you’re bearish, the $350 puts provide a safety net. But one thing’s clear: Home Depot isn’t going anywhere fast—until it does.