QQQ Options Signal Bearish Skew: Key Strikes and Strategies for Q1 2026 Volatility

• QQQ trades at $625.88, up 0.87% with volume surging to 23.8M shares.
• Put/call open interest ratio hits 1.54, with $610 puts dominating this Friday’s chain.
• Block trades hint at institutional bearishness: 2,000 contracts bought in the $624 put ahead of Jan 30.
• Recent news blends optimism (record inflows) and caution (regulatory inquiry).

Here’s the thing: QQQ’s options market is whispering caution. While the stock sits in a short-term bullish Kline pattern and RSI near overbought territory, the open interest tells a different story. Puts dominate at key levels, and block trades suggest big players are hedging or positioning for a pullback. Let’s break it down.

The Bearish Skew in Open Interest and Block Trades

The options chain for this Friday (Jan 9) shows a stark imbalance. At-the-money $630 calls have 15,024 open contracts, but the $610 puts lead with 39,117. That’s not just bearish—it’s a warning sign. The next Friday’s chain (Jan 16) amplifies this: $610 puts surge to 79,428 open interest, while the most popular call is the $627 strike with 56,540.

Block trades add fuel. The QQQ20260130P624 put was bought in bulk (2,000 contracts), and the QQQ20260130C634 call was sold in the same volume. Think of it like a tug-of-war: someone’s betting on a dip, and others are hedging against a rally. The danger? If QQQ breaks above its 30D support/resistance range (623.80–624.35), the puts could expire worthless, but a drop below the 200D moving average (561.26) would turn this into a rout.

News: Optimism vs. Regulatory Headwinds

QQQ’s recent headlines are a mixed bag. Record inflows and a new ESG-focused ETF signal strong demand for tech exposure. But the SEC inquiry into trading practices casts a shadow. Retail investors might ignore the regulatory risk, but institutional players? They’re already hedging. The ESG ETF launch could attract new money, but the inquiry could trigger a selloff if compliance issues surface.

Here’s the rub: QQQ’s performance is tied to the Nasdaq-100’s tech darlings. If AI and cloud stocks keep surging, the ETF will ride that wave. But if the SEC investigation escalates, the 600-level support on Bollinger Bands (604.46) could face pressure. Investor sentiment is fickle—good news today, bad headlines tomorrow.

Actionable Trades: Calls, Puts, and Price Levels

For options traders, the most compelling plays are:

• Sell the QQQ20260116C630 call if QQQ stays below $627 (intraday low). With RSI at 70.56, overbought conditions could trigger a pullback. Target a $5–$7 premium decay by expiration.
• Buy the QQQ20260116P610 put if the stock dips below 619.06. The 600–610 put chain has massive open interest, so a break below 610 could accelerate selling.

For stock traders:

• Long entry near $623.80 (30D support). Target 631.38 (Bollinger Upper Band) if the 200D MA (561.26) holds. Stop-loss below 619.06.
• Short above $627 with a target at 610. The MACD histogram (0.198) suggests momentum is fading—don’t chase a breakout.

Volatility on the Horizon

The next 72 hours will test QQQ’s resolve. A close above 626.09 (intraday high) could trigger a rally toward 635, but the put-heavy options chain implies a 600–610 range is the likely battleground. Keep an eye on the SEC inquiry—any escalation could turn this into a short-term bear play. For now, the data says: trade with caution, but don’t abandon the bullish trend entirely. The Nasdaq-100’s tech darlings aren’t done yet, but the options market is pricing in a storm.