Walmart (WMT) Options Signal $110 Call Battle: Bullish Breakout or Bearish Trap?

• Walmart’s stock surged 6.2% to $106.86, driven by Q3 earnings beats and a Nasdaq listing shift
• Options data shows heavy call open interest at $110 and $115 strikes, but puts dominate at $92.50
• RSI at 41 and MACD bearish suggest short-term pullback risk, but long-term range-bound potential

Here’s the thing: Walmart’s stock just had a wild ride, but the options market is whispering a different story. While the price action screams "cautious optimism," the options data tells us to watch the $110 level like a hawk. Let’s break down why this could be a setup for either a breakout or a breakdown.

The OTM Options Dance: Calls vs. Puts at a Crossroads

Take a look at the options chain—calls are clustering at $110 (20,847 open interest) and $115 (12,285 OI), while puts are piling up at $92.50 (31,768 OI). This isn’t just noise. It’s a chess match: bulls are hedging for a push above $110, while bears are bracing for a drop below $100. The put/call ratio at 1.01 means both sides are equally active, but the heavy put OI at $92.50 hints at a psychological floor many are eyeing.

But here’s the twist: the $110 call is the most popular, yet the RSI at 41 and MACD (-0.51) suggest the rally might be running out of steam. If the stock can’t break above $107.72 (intraday high), those calls could turn into a trap. Conversely, a close above $110 would validate the bulls’ thesis and trigger a wave of call buying.

Earnings Beats and Nasdaq Moves: Why the Market Can’t Decide

Walmart’s Q3 results were a mixed bag. E-commerce growth and a CEO transition story are bullish, but the stock’s 5.8% year-over-year jump has already priced in some optimism. The Nasdaq listing shift in December might improve liquidity, but it’s also a short-term distraction. Retail investors love stories, but algorithms care more about fundamentals. The key question: Will the 27% e-commerce growth translate to sustained momentum, or is this a one-off pop?

The options market is split. Call buyers are betting on the "e-commerce miracle," while put holders are hedging against inflation headwinds. Think of it like a tug-of-war: every time the stock tests $107.72, the puts at $100 (12,805 OI) could drag it back down. But if the $110 call holders get their wish, the middle Bollinger Band at $102.77 could become a memory.

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

If you’re bullish but cautious, consider a $110 call ladder (expiring Friday). Buy the $110 call at $1.25 (assuming typical premiums) and sell a $115 call to offset cost. Why? The stock needs to break $110 to justify the trade, but the $115 strike caps your upside. If WMT gaps up on Friday, you’ll have a clean exit.

For the bears, a $100/$95 put spread (expiring next Friday) could work. Buy the $100 put and sell the $95 put. The stock needs to drop below $100 to profit, but with support at $102.46, this is a low-risk bet if the RSI dips below 30. The put at $92.50 is a "deep in the money" play—save that for if the stock collapses.

Stock traders: Consider entries near $102.77 (middle Bollinger Band) if the price holds above $102.46. Target $107.72 as a short-term peak, but set a stop below $100.98 (100D MA). The 30D MA at $103.73 is a psychological floor—break that, and the 200D MA at $97.82 becomes a death trap.

Volatility on the Horizon: What to Watch Next

The next 72 hours will be critical. If WMT closes above $110, the $115 calls could ignite a rally. But if it stalls below $107.72, the puts at $100 will dominate. The Nasdaq move on December 9 could add liquidity, but don’t expect miracles—retail stocks are still sensitive to consumer sentiment.

Bottom line: This is a high-stakes poker game. The options data shows a 50/50 battle, but the technicals lean bearish in the short term. Play it smart: use the $110 call as a directional bet, but keep a stop below $102.46. And if the stock dips to $100, the puts at $95 could be your best friend. Either way, Walmart’s story isn’t over—just getting started.