Few US Stocks Hit New Highs, But Options Traders Bet These Names Will Reach Fresh Peaks

According to CNBC, the recent rally in US stocks has been concentrated in a small number of names. On Tuesday (22nd), the New York Stock Exchange saw 75 stocks hit 52-week lows, while only 14 reached new highs. Nevertheless, options trading data shows that investors continue to bet on further gains in the Nasdaq 100 index and certain technology stocks.

US equities surged strongly on Monday, and some institutional market makers may have failed to keep pace with the momentum, resulting in increased purchases of call options. Barchart data shows the ratio of call-to-put options volume rose to its highest level since May. For SPY, the ETF tracking the S&P 500 index, the ratio reached its highest point since the first week of August.

For QQQ, the ETF tracking the Nasdaq 100 index, the call-to-put volume ratio climbed to its highest level in at least a year. Pricing data from the trading platform ThinkOrSwim indicates that, based on Tuesday’s market levels, the Nasdaq 100 has over a 67% probability of reaching a new high by the end of the week.

On an individual stock basis, options markets show bullish sentiment toward Meta (META-US), Intel (INTC-US), and Micron (MU-US). Pricing models suggest traders are betting these stocks will challenge new highs before year-end.

Meta’s options volume this week exceeded four times the average over the past 30 days. Barchart data shows implied volatility for call options across all expiration dates exceeds that of put options for Meta. According to ThinkOrSwim pricing at the time, Meta has a 52% chance of reaching its previous closing high of $790 by October 2.

Intel has risen 40% over the past month, fueling increased options activity. Market maker pricing suggests roughly a 50% chance the stock will surpass its closing high of approximately $140 by October 30.

Options pricing indicates market expectations that Micron (MU-US) could reach a new high by October 23 and SanDisk (SNDK-US) by December 18.

However, the implied volatility of the DRAM ETF, which also tracks the memory theme, has declined significantly since the summer. Market maker pricing shows only a 34% chance that the ETF will reach a new high by December 18, highlighting a divergence between individual stock and sector ETF options positioning.