Apple and Amazon report after the bell. Here's what the options market is saying

Apple and Amazon earnings reports arrive after the bell today, serving as a critical test for market stability. Recent sessions saw mixed results for other tech giants, creating a cautious environment for investors. Apple carries significant momentum, holding a 25 percent gain year-to-date and a 7 percent rise since early June. Despite this, options traders anticipate heightened volatility, pricing in a 3.4 percent move post-earnings. This exceeds the stock's typical median move of 1.5 percent seen over the last four reporting periods.

Sentiment analysis reveals a shift in market perspective for Apple. While the week began with bullish positioning, recent broader market declines led traders to take a more cautious, bearish stance. Volume data shows significant activity in 330-strike puts for Friday expiration, suggesting some investors are positioning for a potential downturn.

Amazon presents a different narrative as the stock remains flat for the year. Options flows for Amazon indicate more optimism compared to Apple, with traders leaning toward selling volatility rather than buying it. Net trade sentiment remains positive for the company. Market participants currently expect a 6.6 percent swing following the report, which aligns closely with the company's historical post-earnings move of 7 percent.

These reports arrive at a time when the market is searching for direction. With tech earnings providing mixed signals in recent days, today’s data will confirm whether these two companies can hold up the market or contribute to further volatility. Investors are watching closely as liquidity flows through the options market, setting the stage for significant price action.