NFLX Options Signal Battle at $1,100: How Traders Can Navigate the Tax-Driven Volatility

• Netflix (NFLX) shares trade near $1,090.64, down 0.37% after a Q3 earnings miss tied to a Brazilian tax dispute.
• Options data shows heavy call open interest at $1,150 and $1,200, while puts dominate at $1,000 and $1,080.
• Technicals hint at a short-term bearish bias, with RSI at 39.27 and price near the 200-day MA.
• The stock’s 17% revenue growth and ad sales surge clash with near-term margin pressures.

The options market is locked in a tug-of-war around $1,100. With open interest split almost evenly between calls and puts, traders are hedging both sides of a story: a streaming giant with strong fundamentals but a near-term tax headache. Here’s how to read the signals—and where to position for the next move.The Options Crossroads: Calls vs. Puts at Key Strikes

Let’s start with the numbers. This Friday’s options chain shows heavy call open interest at $1,150 (2,277 contracts) and $1,200 (2,237), while puts pile up at $1,000 (2,559) and $1,080 (1,604). The put/call ratio for open interest is nearly 1.01, meaning bulls and bears are equally active—but not equally confident.

Here’s what that tells us:

• Bullish bets at $1,150 and $1,200 suggest traders expect a rebound after the earnings selloff. The $1,200 strike, in particular, feels like a psychological target for those betting on NFLX’s long-term ad revenue growth.
• Bearish positioning at $1,000 and $1,080 reflects fear of a deeper pullback. The $1,080 strike lines up with the 200-day moving average (1,115.40), which could act as a temporary floor if the stock breaks below current levels.

The lack of block trades (no big institutional orders) means this is a retail-driven battle—for now. But with expiration Friday approaching, we’ll likely see a price test of these key strikes as options holders square off.

Earnings Shockwave: Tax Dispute vs. Ad Revenue Optimism

The Brazilian tax dispute is the elephant in the room. Netflix’s Q3 earnings miss—$5.87/share vs. $6.97 expected—wasn’t just about subscriber growth or content costs. It was a one-time hit from a 10% tax on international payments, which the company now expects to lose in court. That’s a textbook example of non-recurring pain: bad for Q3, but not a long-term threat.

Yet the market is treating it like a chronic issue. Why? Because the news clashes with NFLX’s broader narrative: 17% revenue growth, record ad sales, and a 29% operating margin (still better than most SaaS companies). The disconnect between fundamentals and sentiment is the opportunity.

Think of it like a storm in a single room. The Brazilian tax issue is a localized problem, but it’s rattling the whole house. Traders who can separate the noise from the signal—like those buying puts at $1,080 to hedge a short-term dip—might find value in a stock that’s still trading below its 30-day high of $1,206.15.

Actionable Trades: Calls, Puts, and Price Levels to Watch

Let’s get specific. Here are three setups based on the data:

1. Bearish Play: Short-Term Puts at $1,080

• Why it works: The $1,080 put (OI: 1,604) aligns with the 200-day MA and the lower Bollinger Band (1,102.70). If NFLX breaks below $1,090, this strike could see a rush of buyers.
• Entry: Buy the $1,080 put expiring Friday.
• Target: $1,050 if the stock gaps down on Monday.

1. Bullish Play: Call at $1,150 for a Rebound

• Why it works: The $1,150 call (OI: 2,277) is a sweet spot for those betting on NFLX’s ad revenue momentum. If the stock holds above $1,090, this strike could act as a catalyst.
• Entry: Buy the $1,150 call expiring next Friday.
• Target: $1,200 if the stock closes above $1,150 by expiration.

1. Stock Trade: Buy the Dip at $1,090

• Why it works: NFLX is trading near its 200-day MA and the lower Bollinger Band. A close above $1,100 would signal strength.
• Entry: Buy NFLX at $1,090–$1,095.
• Stop Loss: $1,070 (below the $1,080 put-heavy zone).
• Target: $1,150 if the stock reclaims its 30-day high.

Volatility on the Horizon: What to Watch Next

The next 72 hours will be critical. If NFLX holds above $1,090, the $1,150 call-heavy zone could attract buyers. A break below $1,080, however, might trigger a test of the $1,050 support (lower Bollinger Band).

Here’s the kicker: The options data suggests a range-bound outcome. With calls and puts equally active, the market isn’t pricing in a massive move—just a tug-of-war. That means the real opportunity lies in timing.

For now, keep an eye on the 200-day MA and the $1,150 strike. If NFLX can close above $1,150 by next Friday, the tax-driven selloff might look like a buying opportunity. But if the stock can’t hold $1,090, the puts at $1,080 could become a lifeline for short-term traders.

The bottom line? This isn’t a “buy and hold” moment. It’s a chess game with volatility as the board. Play your pieces carefully—and watch the options market for the next move.