Reddit Options Trading: A Deep Dive into Market Sentiment

Investors with significant funds have taken a bearish position in Reddit RDDT, a development that retail traders should be aware of.

This was brought to our attention today through our monitoring of publicly accessible options data at Benzinga. The exact nature of these investors remains a mystery, but such a major move in RDDT usually indicates foreknowledge of upcoming events.

Today, Benzinga's options scanner identified 10 options transactions for Reddit. This is an unusual occurrence. The sentiment among these large-scale traders is mixed, with 40% being bullish and 50% bearish. Of all the options we discovered, 9 are puts, valued at $635,800, and there was a single call, worth $44,000.

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Expected Price Movements

After evaluating the trading volumes and Open Interest, it's evident that the major market movers are focusing on a price band between $60.0 and $100.0 for Reddit, spanning the last three months.

Analyzing Volume & Open Interest

Looking at the volume and open interest is a powerful move while trading options. This data can help you track the liquidity and interest for Reddit's options for a given strike price. Below, we can observe the evolution of the volume and open interest of calls and puts, respectively, for all of Reddit's whale trades within a strike price range from $60.0 to $100.0 in the last 30 days.

Reddit Call and Put Volume: 30-Day Overview

Significant Options Trades Detected:

About Reddit

Reddit Inc is engaged in providing internet content. The company provides online services that include gaming, sports, business, crypto, television and others.

Following our analysis of the options activities associated with Reddit, we pivot to a closer look at the company's own performance.

Present Market Standing of Reddit

• Trading volume stands at 490,793, with RDDT's price up by 1.21%, positioned at $58.34.
• RSI indicators show the stock to be may be approaching overbought.
• Earnings announcement expected in 87 days.

What Analysts Are Saying About Reddit

5 market experts have recently issued ratings for this stock, with a consensus target price of $58.6.

• Consistent in their evaluation, an analyst from Citigroup keeps a Buy rating on Reddit with a target price of $65.
• An analyst from Goldman Sachs persists with their Neutral rating on Reddit, maintaining a target price of $55.
• An analyst from Bernstein has decided to maintain their Underperform rating on Reddit, which currently sits at a price target of $45.
• An analyst from Needham has decided to maintain their Buy rating on Reddit, which currently sits at a price target of $63.
• Consistent in their evaluation, an analyst from Piper Sandler keeps a Overweight rating on Reddit with a target price of $65.

Options are a riskier asset compared to just trading the stock, but they have higher profit potential. Serious options traders manage this risk by educating themselves daily, scaling in and out of trades, following more than one indicator, and following the markets closely.

If you want to stay updated on the latest options trades for Reddit, Benzinga Pro gives you real-time options trades alerts.