Cloudflare options activity surges as stock hits 52-week high

Cloudflare Inc (NET) stock reached a 52-week high of $352.45 on September 21, closing at $351.67, which also represents an 8.67% gain. Following the close, options activity surged, with 26,864 call options traded versus 12,439 puts, indicating a significant bullish tilt with a 2.16:1 call-to-put ratio. The Oct $350 call volume exceeding open interest suggests new bullish exposure at the money, as someone opened fresh long positions on a day that marked a new high for NET.

Moreover, the Nov $350/$370 put spread demonstrates a protective strategy for bearish traders who only expect price movement above $370, while hedgers are quietly paying up for downside protection in an otherwise bullish market. The 3-month implied volatility increased to 64.09%, indicating that options traders are pricing in wider future swings even after the 8.67% single-session move.

The 90/110 skew is slightly elevated at 1.37ppt, implying that out-of-the-money puts are slightly more expensive than equivalent calls, showing that hedgers are paying up for downside protection despite the recent bullish momentum. The daily Relative Strength Index (RSI) is at 65.4, indicating a healthy level, while the weekly StochRSI has reached 96.4, suggesting it is overbought. This is further confirmed by the weekly Average Directional Index (ADX) at 48.4, which signifies a powerful trend in force.

The article concludes that while the overall market sentiment is bullish, investors should exercise caution and avoid chasing the momentum recklessly. The Nov $350/$370 put spread with zero prior open interest on the $370 leg indicates fresh institutional hedging, with someone with a large long position opening a collar-like structure today to lock in gains between $350 and $370.

The October $350 calls are short-dated momentum bets with a 2-week timeframe to capitalize on any continued breakout. With a Year-to-Date (YTD) performance of +76.81% and a market cap of $125.06 billion, NET is considered one of the notable growth stories of 2026. The asymmetric options activity, with aggressive bullish bets coupled with protective structures, warrants close monitoring.