As Exxon Mobil, Southwest Airlines Gear Up For Earnings Next Week, Here's A Look At Options Market Outlook

U.S. markets have been trading in the flat zone over the last two days as investors and traders weighed in on a mixed set of corporate earnings. Next, week Exxon Mobil Corp XOM and Southwest Airlines Co LUV are scheduled to report their quarterly earnings. It would be interesting to see what kind of guidance these companies provide in the wake of the significant OPEC+ decision to trim production output that lead to a rise in oil prices.

Also Read: How To Buy Exxon Mobil (XOM) Stock

Meanwhile, here's a look at how traders are positioning themselves in the options market ahead of the earnings announcements:

1. Exxon Mobil: Shares of the company have risen over 13% in the last month and closed Wednesday's trading session at $116.57. Options expiring on April 28 show maximum open interest accumulation at the $120 Call strike amongst out-of-the-money Call options. This indicates the market may be building on a view that the level could act as a resistance in the short term. On the downside, the $115 Put strike has the maximum open interest accumulation, indicating traders may be considering limited downside for the stock next week as the strike is close to the stock's closing price on Wednesday.

2. Southwest Airlines: Shares of the company gained over 7% in the last month and closed at $32.45 on Wednesday. Interestingly, open interest accumulation amongst Calls is highest at the $32 Call strike which is close to the stock's closing price on Wednesday. This could mean traders may be considering limited upside for the stock next week. On the downside, maximum open interest, at the time of writing, can be seen at the $29 Put strike, indicating the level could act as a support.

It is noteworthy that open interest numbers on options expiring next week are in the process of building up and more clarity will emerge as next week commences.

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