XOM's Call-Heavy Options Setup and $119 Bullish Catalyst: How to Position for Earnings-Driven Volatility

• Exxon Mobil (XOM) surged 2.27% to $117.10, breaking above its 200-day moving average of $110.12
• Options data shows 3,825 open calls at the $119 strike (this Friday’s expiry) vs. 4,307 puts at $108
• Earnings report highlights $7.5B profits, $9.4B shareholder returns, and record production in Guyana/Permian

Here’s the core insight: XOM’s options market is screaming bullish with a clear price target. The stock’s 2.27% intraday gain, combined with a call-heavy open interest imbalance and earnings-driven fundamentals, points to a high-probability breakout above $119. Let’s break down why this matters for your portfolio.

Bullish Imbalance in Options: Calls at $119 Signal Institutional Conviction

Options traders are piling into calls just above the current price. The $119 strike (3,825 open interest) and $120 strike (3,598 OI) dominate Friday’s call chain, while next week’s $121 strike (2,932 OI) shows growing momentum. This isn’t random—big money is positioning for a short-term rally.

Meanwhile, puts at $108 (4,307 OI) and $110 (2,558 OI) suggest some hedging activity, but the put/call ratio of 0.65 (favoring calls) tells us bears aren’t in control. Think of it like a tug-of-war: the call buyers are pulling harder right now.

The risk? If oil prices reverse or earnings optimism fades, the $114.19 support level (30-day average) could trigger a pullback. But with Bollinger Bands showing the price near the upper band ($117.14), the immediate trend is clearly upward.

Earnings Report Fuels the Bull Case—But Can It Last?

Exxon’s $7.5 billion Q3 profit isn’t just a number—it’s a statement. Record production in Guyana (700,000 bpd) and the Permian Basin (1.7M bpd) proves the company can deliver even as oil prices dip. CEO Darren Woods’ emphasis on “oil economics doubling since 2019” is music to investors’ ears.

But here’s the catch: this isn’t just about fundamentals. The market is pricing in continuity. If the Fed’s rate cuts or geopolitical tensions boost energy demand, XOM’s $1.03/share dividend and $27B capex guidance could make it a safe haven. However, if inflation fears resurface, the $108.34 (200-day support) level might test patience.

Actionable Trades: Calls at $119, Stock Entry Near $114.19

For options traders: Buy the XOM 11/21 $119 calls (3,825 OI) if you expect a post-earnings pop. These expire Friday, so they’re ideal for a short-term bet on the $119.50 resistance level. For a longer play, the $121 calls (2,932 OI) next week offer more time if the rally accelerates.

Stock buyers: Consider entering near $114.19 (30-day support) with a stop-loss below $113.69 (middle Bollinger Band). Target zones are $119.50 (key resistance) and $124 (next major level, where 1,263 OI exists).

Bearish hedges: The $113 puts (2,155 OI) could protect against a drop below $114.19, but only if you’re holding long-term positions.

Volatility on the Horizon: Why This Setup Matters

XOM isn’t just a stock—it’s a barometer for energy markets. The alignment of technicals (bullish engulfing pattern), options flow (call dominance), and fundamentals (production records) creates a rare convergence.

But don’t ignore the risks. If the stock closes below $113.69, the 200-day MA at $110.12 could trigger panic selling. That’s why balancing bullish calls with a stock position at $114.19 makes sense—it gives you upside potential while capping downside risk.

Bottom line: This is a high-conviction trade for those comfortable with short-term volatility. The options market is pricing in a $119+ move, and Exxon’s earnings report gives it the credibility to get there. But always keep a close eye on the $114.19 level—it’s the difference between a breakout and a breakdown.