Applied Materials closed at USD 507.18, down 5.12% from the previous session.
Despite the sharp decline, massive bullish conviction surfaced in the options market. A single trader sold $3.97 million in put premium, dwarfing all bearish activity. The overall flow was decisively positive, with net bullish premium of $3.27 million, as a massive out-of-the-money put sale on the 2026 $370 strike signaled extreme confidence that the stock remains well above that level long-term.
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Options Indicators
AMAT’s implied volatility is 55.66%, while its IV percentile stands at 46.61%, which places current volatility in a neutral range rather than at an extreme. In other words, options are neither especially cheap nor especially expensive versus their own recent history. At the same time, the IV/HV ratio of 0.68 suggests implied volatility is running below realized volatility, indicating the market’s forward pricing of volatility is somewhat restrained relative to what the stock has actually been delivering. The Call/Put volume ratio is 0.95.
Large Trades
A $3.97 million short put was the standout large trade, with 6,305 contracts sold on the October 16, 2026 $370.0 put. With AMAT referenced at $507.18, this strike sat out of the money, making the position a moderately bullish premium-selling trade that benefits if the stock stays well above $370 into expiration. The seller is effectively expressing confidence that downside risk remains limited over the long horizon, while collecting option premium and potentially signaling willingness to own shares at a much lower effective level if assigned.
Overall sentiment in AMAT large trades skewed clearly bullish, with total bullish flow of $3.97 million versus total bearish flow of $0.71 million, for a net bullish difference of $3.27 million. The directional read is decisively positive, as the dominant flow was concentrated in a sizable out-of-the-money put sale, a structure typically associated with premium collection and constructive downside confidence. While there was some bearish activity in smaller call-selling and put-buying trades, it was far too small to offset the scale of the bullish put-writing interest.
Strategy Reference
For traders seeking a similar but more conservative posture, selling the January 2027 $300 put would offer a wider margin of safety with a lower delta, while a bull put spread using the $370/$300 strikes could define risk and reduce margin requirements for those wary of naked put exposure.
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