Meta (META) Options Signal Bullish Bias: Key Call Strikes and Block Trades Point to $670+ Upside Potential

• Meta’s options market shows a 0.57 put/call open interest imbalance, favoring bullish positioning ahead of key resistance levels.
• Block trades totaling $3.1M in call options hint at institutional bets on a $670+ price target by late January.
• Technical indicators and analyst reports align with a "buy the dip" narrative, despite near-term margin risks.

Here’s the core insight: Meta’s options activity and technicals are painting a clear picture of a stock poised to break out of its long-term range—if it can hold above $650. The data suggests upside potential, but with risks if support fails.

Bullish Sentiment Locked in Call Options, Whale Moves Signal Confidence

The options market is heavily skewed toward calls, with 13,390 open contracts at the $700 strike (this Friday’s expiry) and 6,989 at $675 for next Friday. That’s not just noise—it’s a vote of confidence from options traders who expect a push above current levels. Meanwhile, puts dominate at $630 and $660, but the volume is a fraction of the call side.

The real story? A $2.37 million block trade in the META20260116C770 call (expiring Jan 16, 2026) caught attention. Buying 400 contracts at a $770 strike implies someone is banking on a sharp rebound—possibly tied to Meta’s next Llama AI launch or WhatsApp monetization updates. Combine that with Baird’s "buy the dip" call and Meta’s AI-driven ad growth, and you’ve got a recipe for a breakout.

But don’t ignore the risks. If the stock dips below $648 (30D support), those puts at $660 could trigger a cascade of stop-loss orders. The RSI at 56 and MACD crossing above the signal line suggest momentum is building—but a false break could test resolve.

News Flow and Market Narrative: AI as the New Metaverse?

Meta’s recent headlines are a mixed bag. On one hand, analysts like Baird are cheering a 23% upside potential, citing AI-driven ad tools and next-gen wearables. On the other, the $70B+ AI spending spree has some investors comparing it to the metaverse money pit.

Here’s the twist: Unlike the metaverse, AI is already boosting ad engagement and pricing power. Third-quarter ad revenue grew 26% year-over-year, and Meta’s free cash flow ($44.8B) gives it room to keep innovating. The options data reflects this duality—traders are betting on AI-driven growth but hedging against margin pressures.

Actionable Trade Ideas: Calls for the Breakout, Stock for the Grind

For options players, the META20251226C670 (this Friday’s expiry) and META20260102C675 (next Friday) are prime candidates. Why? The $670 strike sits just above the 200D moving average ($671.44), and the $675 strike aligns with the 100D MA ($706.37) on a shorter timeline. If Meta closes above $670 this week, those calls could see explosive gains.

For stock traders, consider entries near $650 (middle Bollinger Band) if support holds. A break above $675 (next Friday’s key call strike) would target $700–$720, where the top OTM calls reside. Stop-loss levels? $648 (30D support) and $630 (put-heavy zone).

Volatility on the Horizon: A Tug-of-War Between AI Optimism and Margin Realism

The coming weeks will test Meta’s narrative. A strong earnings report or AI milestone could propel shares toward $700+, validating the call-heavy options bets. But if margin pressures linger or monetization lags, the stock could retest $620 (lower Bollinger Band).

Bottom line: This is a stock at a crossroads. The options market and technicals lean bullish, but patience is key. As one analyst put it, "Meta’s AI bets aren’t just speculative—they’re already paying dividends." For traders, the challenge is balancing that optimism with discipline—because in this market, even the strongest stories need a solid foundation.