PEP Options Signal Bullish Bias: Key Strikes and Strategies for Dec 12 Expiry

• PEP trades at $145.67, up 0.44% with volume surging past 2.26M shares
• Call open interest dominates at $150–$155 strikes, while puts cluster at $140–$145
• Block trade of 30K puts at $140 hints at institutional downside protection

Here’s what’s happening: PEP’s options market is whispering bullish optimism, but technicals tell a mixed story. The stock sits just below its 30-day moving average ($146.45) while call options at the $150 strike ($PEP20251212C150) show heavy open interest. Yet RSI at 47.26 and a bearish MACD histogram (-0.03) suggest caution. Let’s break it down.

Bullish Calls vs. Defensive Puts: What the Options Are Saying

The options chain is a chessboard of bets. For this Friday’s expiry (Dec 12), calls at $150 ($PEP20251212C150) and $155 ($PEP20251212C155) dominate with 1,197 and 956 open contracts respectively. That’s not just noise—it’s a crowd betting on a $145.67 stock breaking above $150. But don’t ignore the puts: $140 ($PEP20251212P140) and $145 ($PEP20251212P145) have 478 and 386 open contracts, guarding against a drop below current levels.

The block trade of 30,000 puts at $140 ($PEP20251017P140) is telling. Someone big is hedging a near-term downside risk, possibly ahead of earnings or guidance. Combine that with a put/call ratio of 0.655 (calls > puts) and you’ve got a market leaning bullish—but not blindly so.

News vs. Options: Sustainability Wins, Margins Lose

PepsiCo’s regenerative agriculture push (3.5M acres under sustainable practices) is a PR win, but the earnings story is murkier. Recent reports flag declining unit sales and 2.4-point margin drops. The options market isn’t pricing in disaster—those $150 calls exist because investors still see long-term value in Pepsi’s global beverage dominance. But the puts at $140? They’re a nod to near-term risks like North American softness and currency headwinds.

Actionable Trades for Today: Calls, Puts, and Price Levels

For options players: Buy-to-open $150 calls ($PEP20251212C150) if PEP breaks above $146.56 (intraday high). Target a close above $150 by expiry. Alternatively, sell-to-open $140 puts ($PEP20251212P140) if support at $144.2 holds—price is testing the lower Bollinger Band ($142.56) and 200-day MA ($142.37). For stock traders: Consider entries near $144.2 (intraday low) with a stop below $142.56. Target $146.45 (30-day MA) first, then $150 (call-heavy zone).

Volatility on the Horizon: Balancing Bullish Bets and Bearish Caution

The next week will test PEP’s resolve. A break above $146.56 could trigger a rally toward $150, fueled by call buyers. But a drop below $144.2 might see puts at $140 ($PEP20251212P140) act as a floor. Either way, the options market has priced in a range-bound story with upside potential. Stay nimble—this isn’t a one-way bet, but the data leans bullish for now.