Meta (META) Options Signal Bullish Bias Amid AI Expansion: Key Levels to Watch for Breakouts and Hedging Strategies

• Meta’s stock plunges 2.08% to $719.14 amid bearish short-term technicals but remains above its 200D MA of $665.74.
• Options market shows a 0.71 put/call open interest ratio, with heavy call OI at $750–$780 and bearish block trades selling calls at $780–$800.
• Meta’s AI infrastructure deals and Rivos acquisition signal long-term growth, but energy costs and regulatory risks linger.

The current price action and options positioning paint a nuanced picture: while technical indicators and short-term sentiment lean bearish, the options market and company fundamentals suggest a potential rebound. Traders must navigate this duality by targeting key levels where bullish catalysts could override near-term weakness.

Decoding Options Imbalance and Whale Moves: A Battle for $750–$780

The options chain reveals a stark imbalance: call open interest dominates at strikes like $750 (5,220 OI) and $770 (5,532 OI) for Friday expiration, while puts peak at $720 (2,759 OI). This suggests institutional positioning for a rebound above $750, with heavy liquidity at $770–$780 acting as a magnet for upside momentum. The put/call ratio of 0.71 (put OI: 833,885 vs. call OI: 1,167,004) reinforces a structural bullish bias, though bearish block trades—such as the 5,798 contracts sold at $840 expiring in September—hint at hedging by large players.

Notable block trades add layers of intrigue. The $2.37M sale of 400 contracts at $770 (expiring January 2026) and 3,000 contracts sold at $780–$800 (November 2025) suggest whales are locking in profits or hedging against a potential pullback. These moves could pressure the stock if Meta fails to break above $753.90 (30D MA), but the heavy call OI at $770 implies a strong bid to defend that level.

AI Infrastructure and Wearables: Fueling Long-Term Optimism

Meta’s aggressive AI expansion—$14B in cloud deals, $10B data centers, and the Rivos acquisition—positions it to reduce costs and accelerate hardware innovation. The Prometheus supercluster in Ohio and Llama AI’s global rollout signal a strategic pivot toward self-sufficiency in AI infrastructure. These moves align with the options market’s bullish tilt, as investors bet on Meta’s ability to scale its AI ecosystem.

However, risks persist. The Louisiana data center’s $3B energy costs and regulatory scrutiny over AI-driven ad targeting could weigh on sentiment. While the news flow is largely positive, traders should monitor earnings reactions and energy cost disclosures for volatility triggers.

Actionable Strategies: Calls for Breakouts, Puts for Hedging

For options traders, the most compelling setups are:

• Bullish: Buy META20240920C750 (Friday expiration, $750 strike) if Meta closes above $753.90 (30D MA). The 5,220 OI at this strike suggests strong liquidity and a potential breakout catalyst.
• Bearish: Buy META20240920P720 (Friday expiration, $720 strike) as a hedge if the stock tests the lower Bollinger Band at $729.84. The 2,759 OI at this level offers downside protection.

For stock traders, consider:

• Entry: Target $729.84 (lower Bollinger Band) if support holds, with a stop-loss below $710.20 (intraday low). A break above $753.90 (30D MA) could trigger a rally toward $784.60 (upper Bollinger Band).
• Exit: Take partial profits at $750–$770, aligning with heavy call OI and block trade activity.

Volatility on the Horizon: Balancing AI Ambition and Execution Risks

Meta’s technicals and options data suggest a pivotal phase: the stock is poised to either reclaim its 30D MA and validate the bullish thesis or face a test of its 200D MA. The RSI at 40.58 and MACD histogram (-3.97) indicate oversold conditions, but the bearish signal line crossing above the MACD (-1.31) warns of lingering short-term pressure.

Traders should watch for a breakout above $753.90 to confirm the shift from bearish to bullish momentum. Meanwhile, the block trades at $780–$800 and the $770 call OI suggest a potential inflection point for a rally into year-end. However, energy costs and regulatory risks could disrupt this narrative, making hedging strategies essential for managing downside exposure.

In summary, Meta’s options market and fundamentals present a compelling case for a rebound, but disciplined risk management and precise level targeting will be critical for navigating the coming volatility.