Option Focus | Palantir's $21.2 Million Bullish Call Spread Signals Strong Upside Bet, Dwarfs Small Bearish Premium-Collection Trade

Option Witch07-07 11:33

Palantir Technologies Inc. closed at USD 132.54, rising 2.51%.

Recent large options trades in PLTR were overwhelmingly dominated by a massive, bullish multi-million dollar call spread, signaling strong institutional conviction for further upside, which starkly overshadowed a minor bearish premium collection trade.

Options Indicators

PLTR’s implied volatility is 65.69%, and with an IV percentile of 72.91%, current option volatility sits in an elevated range, indicating that options are priced expensively versus their own recent history. The IV/HV ratio of 1.11 also suggests implied volatility is running modestly above realized volatility, reinforcing the view that the market is embedding a relatively rich premium for near-term movement. The Call/Put volume ratio is 3.08.

Large Trades

A bullish call spread worth $21.17 million was the dominant large trade in PLTR, built by buying 14,951 September 18, 2026 $135.00 calls and selling 14,951 July 17, 2026 $150.00 calls. With PLTR referenced at $132.54, both strikes were out of the money at execution. This is a net-debit structure, with $20.09 million spent on the long call leg versus $1.08 million collected on the short call leg, leaving the trader paying upfront for upside exposure. Strategically, this points to a directional bullish bet with some premium offset from the short call, expressing expectations for further gains while partially reducing entry cost rather than pursuing pure income.

A premium-collection call-selling combination worth $0.11 million added a much smaller, neutral-to-bearish signal, consisting of the sale of 1,339 July 10, 2026 $142.00 calls and 1,339 July 10, 2026 $144.00 calls. Both strikes were out of the money versus the $132.54 reference stock price, and because both legs were sold, the trade was established for a net credit. The strategic intent here is consistent with premium collection and a view that PLTR will remain below those call strikes into expiration, reflecting a range-bound or mildly bearish stance rather than an outright downside bet.

The directional judgment is decisively positive because the tape was overwhelmingly driven by a very large upside call spread, while the only notable opposing flow was a comparatively tiny short-call premium collection trade. In practical terms, large traders appear to be positioning for upside continuation in PLTR, with limited evidence of meaningful institutional resistance beyond minor near-term call overwriting.

Strategy Reference

For traders looking to sell premium with low assignment probability, targeting OTM calls at strikes like $150.00 or above could be considered, while those preferring defined risk and lower margin requirements could emulate the large bullish trade with a vertical call spread, such as buying the $135.00 call and selling the $150.00 call in a later expiration.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment