Can Options Flow Predict Earnings Surprises? How To Avoid Missing Out on FOMO Trades in 2026

By 2026, options flow has become a standard tool for retail investors, traders and portfolio managers who want to see earnings surprises coming. Options flow means tracking unusual options activity (UOA), large sweeps and institutional positioning in real time. More than 11.1 billion options contracts cleared in 2025, and 0DTE options made up over 60% of SPX volume (Cboe, Aug 2025). With that much activity, the signals in the flow are hard to ignore.

Below: how options flow can help predict earnings surprises, with specific trades from 2025 and 2026, the research behind it, and practical steps to avoid FOMO (fear of missing out) on high-conviction earnings trades.

Why Options Flow Matters More Than Ever for Earnings Predictions

The classic way to forecast earnings is fundamentals, consensus estimates and historical patterns. Options flow now sits next to that, because options markets often price in expectations before the report, and those prices reflect what institutional traders and other sophisticated players think.

A 2025 study by the London Stock Exchange Group (LSEG) found that institutional real-time options flow signals had 65.5% directional accuracy in predicting quarterly 13F holdings changes, with high-confidence signals reaching 71.1% accuracy. Retail flow signals came in at 48.8%, barely better than chance. If you want to forecast earnings surprises, the institutional flow is the part to watch.

A November 2025 Wayne State University study in the Journal of Portfolio Management found that unusual options activity, especially large out-of-the-money (OTM) calls or puts close to expiration, correlates with statistically significant positive abnormal returns around earnings dates.

So options flow isn't noise. Read correctly, it's a leading indicator that can show institutional sentiment, and possible earnings surprises, before the numbers come out.

Real Trade Examples from 2025-2026: Options Flow and Earnings Surprises

Recent high-profile trades show the pattern best. In each case, unusual call buying and sweeps came before an earnings beat or a rally.

Tesla (TSLA) January 2026 Call Sweep: $12.9 Million Signal Before Earnings

On December 3, 2025, someone swept 25,005 TSLA January 16, 2026 $550 calls at $5.14 per contract, about $12.9 million in premium paid above the ask. The volume-to-open-interest (V/OI) ratio was 2.7, which points to fresh directional bets, not hedges. And 73% of the volume went off above the ask, a sign of aggressive conviction.

Tesla was trading near $540. When it reported in January 2026, it beat consensus on revenue and margins, and the stock rose over 10% in the week after earnings. Traders who caught the flow were positioned before the rally instead of chasing it.

Google (GOOGL) Massive Institutional Calls in January 2026

Alphabet (GOOGL) gave another example in January 2026. Institutions bought over $3 million in call premium, including a single $3.43 million purchase of 1,104 contracts at the $340 strike expiring June 18, 2026. The net bullish delta imbalance was +162,191, with several seven-figure call trades at strikes from $280 to $330 while GOOGL traded at $333.26.

That much call buying signaled strong bullish sentiment ahead of earnings and other catalysts. GOOGL was up 6.4% year-to-date going into 2026, and the flow said institutions expected more upside. Traders who followed it were in place before the positive earnings surprises that kept the rally going.

NVIDIA (NVDA) May 2026 Earnings: Unusual Call Skew and Premium Signals

Before NVDA's May 20, 2026 earnings, the options chain showed a rare positive skew. Calls traded at a premium to puts even at strikes further out of the money: the $245 calls cost more than the $205 puts with the stock around $222. That's the reverse of the usual volatility skew, and a strong sign of bullish institutional positioning before earnings.

NVDA's implied volatility usually collapses after earnings. In February 2026, IV dropped from about 60% before the report to about 30% after. Traders who expected that used the flow to pick between directional call buying and premium selling around the event.

The Role of 0DTE Options in Earnings-Driven Trading

One of the biggest trends of 2025 and 2026 is the boom in zero-days-to-expiration (0DTE) options. As of August 2025, 0DTE options were a record 62.4% of SPX volume, averaging roughly 2.4 million contracts a day. That continued into 2026, with over 60% of daily SPX volume in 0DTE.

Why does that matter for earnings? 0DTE options let traders bet on very short-term direction and use gamma exposure around earnings and other catalysts. The Wayne State University study found that unusual options activity with short time to expiry and large size correlates strongly with abnormal returns. So heavy 0DTE call sweeps or put activity on earnings days can say a lot about what institutions expect.

On May 28, 2026, for example, flow data showed a heavy concentration of multi-million-dollar sweeps in semiconductor stocks and leveraged ETFs, both known for big earnings-driven swings. Traders watching 0DTE options flow had a shot at fast moves with tight risk control.

Gamma Exposure (GEX) and Its Intersection with Earnings Flow

Gamma Exposure (GEX) adds another layer. GEX measures how market makers' hedging amplifies or dampens moves in the underlying, which feeds straight into volatility and price action around earnings.

In February 2026, SpotGamma flagged growing negative gamma below the SPX price and raised its SPX risk pivot from 6,800 to 6,900. The S&P 500 then fell 2% and the VIX spiked to 28. Watching gamma levels next to options flow can help you see volatility spikes or reversals coming around earnings.

Research from Linköping University (June 2025) also found that GEX levels in S&P 500 options carry predictive information about future equity market volatility. That's especially relevant in earnings season, when volatility usually rises.

How to Use Options Flow to Avoid FOMO on Earnings Trades

Fear of missing out on a big earnings move is a constant problem. Here's how to use options flow so you're not late in 2026.

1. Focus on Institutional-Level Unusual Options Activity

Retail options flow is mostly noise, with only 48.8% directional accuracy (LSEG 2025). Give priority to institutional-sized trades, large sweeps above the ask and big delta imbalances. Tesla's $12.9 million call sweep and Google's multi-million-dollar call buys are textbook examples of what to track.

2. Monitor Volatility Skew and Premium Pricing Ahead of Earnings

Oddities like NVDA's positive call skew before its May 2026 earnings can show the market expects a strong move up. Compare call and put premiums at OTM strikes to catch them.

3. Integrate 0DTE Options Flow into Your Earnings Playbook

With 0DTE options dominating SPX volume, watch for heavy flow on the last trading day before earnings to catch short-term, gamma-driven moves. That's when institutional activity is easiest to see and act on.

4. Combine Options Flow with Gamma Exposure Data

GEX can tell you when the market is set up for the volatility spikes or reversals that often come with earnings surprises. When GEX flips negative near key support, as it did in February 2026, take it seriously.

Why You Need Real-Time Alerts: Don't Let FOMO Win

In the 2026 options market, spotting unusual options activity late means missed trades and FOMO. Optionsbell.com sends email alerts on unusual options activity for $24.99/month, an affordable option for retail traders and portfolio managers.

The alerts focus on the high-confidence, institutional-level flow patterns that the LSEG study tied to 71.1% directional accuracy, so you can position ahead of earnings surprises instead of waiting to see what happens.

Summary: Options Flow Is the New Earnings Radar in 2026

Institutional unusual options activity, read together with volatility skew, 0DTE volume and gamma exposure, can show market expectations well before an earnings release. The Tesla sweep, the Google call buying and the NVIDIA skew all showed up in the flow ahead of the move, and the research on 0DTE activity and GEX backs up why those signals are worth tracking.

Pair the flow with the fundamentals: before you act on a pre-earnings signal, read the company's most recent earnings call transcript to see which guidance and themes management emphasized. When the direction of the unusual options activity lines up with what leadership actually said, the signal is far easier to trust.

References

• London Stock Exchange Group (LSEG), 2025. Real-Time Institutional Options Flow Directional Accuracy Report.
• Wayne State University / Journal of Portfolio Management, Nov 2025. Unusual Options Activity and Earnings Returns.
• CheddarFlow, December 3, 2025. Tesla $12.9M January 2026 Call Sweep.
• Barchart/Yahoo Finance, January 2026. GOOGL Institutional Call Buying Analysis.
• CNBC, May 20, 2026. NVDA Options Skew Ahead of Earnings.
• SeekingAlpha / CNBC, February 2026. NVDA Implied Volatility Earnings Analysis.
• Cboe, August 2025. 0DTE Options Volume Data.
• TradesViz Instagram, May 28, 2026. Semiconductor Options Flow.
• SpotGamma, February 26, 2026. SPX Risk Pivot and Gamma Exposure Report.
• Linköping University, June 2025. Gamma Exposure and Market Volatility Thesis.