Netflix, Inc. (NFLX) Options Traders Set Sights on $100

Netflix, Inc. (NFLX) options traders foresee a run deeper into triple-digit territory by week's end

Mar 28, 2016 at 2:18 PM
facebook X logo linkedin

Netflix, Inc. (NASDAQ:NFLX) has muscled back into triple-digit territory today, up 2.9% at $101.22. Amid the stock's bullish price action, calls are changing hands at 1.4 times the expected intraday rate, and account for nine of the 10 most active strikes.

In the lead is the weekly 4/1 100-strike call, which traders are buying to open for a volume-weighted average price (VWAP) of $1.98. In other words, these call buyers are gambling NFLX will topple breakeven at $101.98 (strike plus VWAP) by Friday's close, when the weekly series expires. The stock last closed above this level on Jan. 21.

The 100 strike has been extremely popular in the past two weeks, on both sides of the aisle. In fact, the four NFLX options that saw the biggest changes in open interest during the last 10 trading days are the March and April 100 calls and puts, each of which added at least 13,600 positions.

Another trend we've seen over the last two weeks is a pronounced preference for long calls over puts. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), NFLX's 10-day call/put volume ratio registers at a top-heavy 1.49 -- and just 4 percentage points from an annual high.

Underscoring this call bias is NFLX's Schaeffer's put/call open interest ratio (SOIR) of 0.94. Not only does this ratio demonstrate calls outweigh puts among options expiring in the next three months, it also rests below 84% of all other readings taken in the past year. In other words, short-term open interest is unusually skewed toward calls over puts, from a historical perspective.

Netflix, Inc. (NASDAQ:NFLX) has done its part on the charts to warrant such optimism. Since panning an early February low of $79.95, the stock has rocketed 27% higher, and appears to have found a foothold atop its 20-day moving average.

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical levels, and top economic stories straight to your inbox.


Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI