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1,000-Contract AI Call Spread Delivers 119.5% Gain—What’s Fueling the Move?
A sharp spike in options trading for C3.ai (NYSE: AI) on May 29, 2025 saw a sizable call spread traded at 1,000 contracts. By day’s end, this trade had more than doubled in value, suggesting conviction behind a rapid price move. Here’s what made this options trade so noteworthy and how it aligns with the current technical and market backdrop.
Trade Details: Buyers Locked in Gains as Stock Rallied $3.07
| Expiration | May 30, 2025 |
|---|---|
| Strikes | 26/29 Call Spread |
| Contracts | 1,000 |
| VWAP Trade Price | $1.10 |
| VWAP Bid/Ask | $0.91 / $1.35 |
| Reference Stock Price | $26.87 |
| Stock Price at Close | $29.94 |
| Days to Expiration | 1 |
On the morning of May 29, traders purchased a 26-29 call spread for a VWAP of $1.10. With the underlying stock jumping $3.07 to close at $29.94, the value of the spread shot up to $2.42. That’s an average profit of $1.32 per contract—an impressive 119.5% gain in just one trading session. All in, buyers put up $55,000 (1,000 contracts x $55 per spread) for the shot to make roughly $95,000, assuming maximum profit is realized at expiration with the stock above $29.
What’s the Strategic Aim of This Call Spread?
Buying a call spread—especially in high volume, just one day before expiration—can suggest either informed speculation on a quick pop, a hedge, or both. This setup is strictly defined-risk, with upside capped, and breakeven set above the lower strike ($26 + $1.10 = $27.10). For full profit, the stock needs to be at or above $29 at expiration—exactly where it closed.
Such precision implies confidence in the underlying stock’s direction, likely catalyzed by recent positive developments. (More on the catalyst below.)
Curious about similar trades? You can review recent multi-leg options trades—including more call spreads—using the Multi-Leg Option Trades Screener.
Technical Indicators Signal Bullish Momentum
| Current Stock Price | $29.94 |
|---|---|
| Price Change | +$6.92 (+30.06%) |
| Open Jump | +15.5% |
| Change from Open | +12.6% |
| Distance from 52W Low | +75.8% |
| Distance from 52W High | -33.6% |
| vs 20d Avg | +30.3% |
| vs 50d Avg | +36.7% |
| vs 250d Avg | +9.7% |
| Bullish Crossover? | Yes |
All key moving averages have been broken to the upside, signaling strong bullish momentum. The price is currently above its 20, 50, and 250 day averages—classic signs of a trend reversal or sustained breakout. Moreover, AI stock has sharply outperformed the S&P 500 (SPY) over multiple periods:
| Duration | AI Return | SPY Return |
|---|---|---|
| Today | +29.6% | +0.4% |
| 2 Week | +25.0% | +0.4% |
| 1 Month | +32.2% | +7.1% |
| 3 Month | +27.3% | -0.4% |
| 1 Year | +23.8% | +12.7% |
The bullish crossover in moving averages further supports a positive technical stance. In short: the trend, by any major metric, is up—and fast.
Option Skew Is Strongly Bullish (90% Rank)
Market Chameleon’s proprietary 30-day skew indicator shows a 90% rank—among the most bullish readings of the past year. A skew this high signals that traders are paying a significant premium for upside calls, likely reflecting heightened demand for bullish bets or upside hedges. Historically, a 90%+ skew rank has aligned with increased odds of near-term rallies or further outsized moves.
Recent News May Explain This Bullish Stance
The recent run in AI stock coincides with major contract news: C3.ai secured a U.S. Air Force Rapid Sustainment Office contract expansion, raising its ceiling to $450 million (an increase of $350 million). This supports a wide-scale deployment of its AI-driven maintenance solutions—one of the largest government AI projects in existence.
Not only does this news add long-term revenue visibility, but the near-term announcement provides an obvious catalyst for the stock’s move—and for the surge in short-term bullish options activity. You can read the full release here.
Bottom Line: What Should Traders Watch Next?
A 119.5% one-day return on a large call spread is rare—and notable. With technicals pointing bullish, option skew strongly favoring more upside, and a multi-million dollar government contract as a likely catalyst, the bullish thesis for AI appears to have real market traction. The main risk: this trade was made one day before expiration, highlighting how rapidly momentum and news can swing results.
If you’re looking to explore similar strategic options plays—on AI or other names—the multi-leg trade analyzer offers an easy way to spot notable trades and review performance. For further analysis on more call spreads or complex trades, check the Multi-Leg Option Trades Screener.
While one trade can’t predict the future, a coordinated spike in technical strength, skew, and contract-driven headlines suggest this move could be more than just a blip. Is it the start of a sustained run? Time—and more data—will tell.
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NOTE: Stock and option trading involves risk that may not be suitable for all investors. Examples contained within this report are simulated and may have limitations. Average returns and occurrences are calculated from snapshots of market mid-point prices and were not actually executed, so they do not reflect actual trades, fees, or execution costs. This report is for informational purposes only, and is not intended to be a recommendation to buy or sell any security. Neither Market Chameleon nor any other party makes warranties regarding results from its usage. Past performance does not guarantee future results. Please consult a financial advisor before executing any trades. You can read more about option risks and characteristics at theocc.com.
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