Why This Week Bull Put Spread (220/215) On Amazon (AMZN)

$Amazon.com(AMZN)$ continue to come into big support again for the fifth month in a row. The short-term (12-EMA) moving average is below the 220 which form a large key support structure from about 205 to below 220.

In this article, I would like to explore how we can plan for Amazon Bull Put spread option trade, the expected move for the week is $221.16 at its lowest, and we might want to consider a strike price nearer to the expected move to leave us with with a very small "margin of error" (about $1.16).

Since our expected move for Amazon (AMZN) is to $221.16, and if we place our sold strike at $220, the stock would remain above our strike price at expiration. This means the options would expire worthless, and we would keep the full profit (the credit received).

The Trade Setup

Symbol: AMZN

Expiration: 30 Jan 2026 (~26 days away)

Strategy: Bull Put Spread (Vertical Put Credit Spread)

• Action 1 (Sell): Sell 1 Put @ $220 Strike

• Action 2 (Buy): Buy 1 Put @ $215 Strike

Net Result: You receive a Net Credit (Cash into your account).

Analysis: The $221.16 Target

• Current Price: ~$226.50

• Our Target: $221.16

• Short Strike: $220.00

• Outcome: $221.16 is >$220.00.

Since the stock price is higher than the short put strike, the put option is Out-of-the-Money (OTM).

Result: You achieve Max Profit. We keep 100% of the premium we collected to open the trade.

Risk Note: If the stock drops just $1.17 lower than our expectation (to $219.99), we will start losing money on the trade.

Risk/Reward Scenarios

How to Execute This Trade

1. Open Order Ticket: Select "Vertical Spread" or "Custom".

2. Order Type: Put.

3. Leg 1 (Short): Sell to Open 1 AMZN 30 Jan 26 $220 Put.

4. Leg 2 (Long): Buy to Open 1 AMZN 30 Jan 26 $215 Put.

5. Price: Set to Net Credit.

Note: Given the current price of ~$226.50, these puts are Out-of-the-Money. The credit will likely be moderate (estimated around $0.80 - $1.20 per share depending on volatility).

Limit Order: Always use a Limit Order. Do not use Market.

Summary

This trade aligns perfectly with our specific price target. We are betting that AMZN will drop, but stop before it hits $220.

• Pros: It profits even if the stock drops $5-$6 from today's price ($226 → $221).

• Cons: If our target is slightly wrong and AMZN hits $219, the trade turns into a loss quickly.

We will look at the actual premium offered when market opens later in the U.S. trading session.

Appreciate if you could share your thoughts in the comment section whether you think it would be a good time to play Bull Put spread for Amazon (AMZN) with expiration at end of January 2026.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire @MillionaireTiger appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.