Meta (META) Options Signal Bullish Bias: Calls at $700 Dominate as AI News Fuels Breakout Potential

• Meta’s Q4 revenue smashed estimates at $35.6B, driven by Metaverse ad growth and AI tools.
• Options data shows 2x more open interest in calls vs. puts, with heavy call volume at $700 strikes.
• A $2.4M block trade in META20260116C770 hints at long-term bullish positioning.

Here’s the takeaway: Meta’s stock is perched at a critical inflection point. The options market is pricing in a strong upside bias, supported by recent AI-driven revenue wins—but regulatory risks and short-term volatility could test that optimism. Let’s break it down.

Bullish Calls at $700 Signal Big Money’s Confidence

The options chain tells a clear story. For this Friday’s expiry, the $690 and $700 calls have 13,270 and 8,883 open contracts respectively—nearly triple the put activity at $630. But the real signal comes from next Friday’s data: the $700 call (META20251219C700) leads with 18,395 open contracts, dwarfing even the $1,000 call’s 15,053. This isn’t just retail hype; it’s institutional positioning.

Then there’s that $2.4M block trade in META20260116C770. Someone is betting Meta will crack $770 by early January 2026. Combine that with the AdOptimize AI platform’s potential to boost ROAS by 25%, and you’ve got a recipe for a breakout. But don’t ignore the puts: $600–$630 strikes have 13,202–7,503 open contracts, suggesting a small but vocal bearish camp. If the stock dips below Bollinger Bands’ middle line at $628.45, that bear case gets legs.

AI News and Regulatory Risks: A Tale of Two Narratives

Meta’s AI-driven ad platform and Microsoft partnership are fueling investor optimism. The $35.6B revenue beat proves these tools are already working. But the EU’s $2B GDPR probe is a wildcard. While the stock surged 8% post-earnings, that 5% drop after a JMP downgrade shows sentiment remains fragile. Retail traders might be buying calls on the AI hype, but institutional investors are hedging with those $600–$630 puts.

Trade Ideas: Calls for the Bold, Puts for the Pragmatic

For options players:

• Aggressive Play: Buy META20251219C700 if price breaks above today’s high of $655.28. Target $720 by expiry.
• Cautious Play: Sell META20251219P630 against long stock holdings to hedge the EU risk.

For stock traders:

• Entry: Consider buying near $640 support (intraday low) if RSI (70.9) corrects below 65.
• Stop: Exit below $628.45 middle Bollinger Band.
• Target: $680–$690 if the $700 call frenzy materializes.

Volatility on the Horizon: Balancing Bullish Momentum with Regulatory Risks

Meta’s story is a tug-of-war between AI-driven growth and regulatory headwinds. The options market is pricing in a 7–10% upside move by year-end, but the EU probe could force a pullback. My read? Go long with calls but keep a tight stop. This isn’t a straight-line trade—it’s a dance between innovation and oversight. Position yourself to ride the AI wave, but keep a seatbelt handy.