Check out the chart. What's that all about?
The reality is the market will move against the herd for 'Maximum Pain Theory' all the time. If the public is majoring in calls it will move down to reduce the counter-party payout. If everyone is in put contracts it will move up to make sure they do not get paid either. But remember hedge funds always have to buy put contracts as a derivative insurance - making the movement to the upside pretty much a guarantee over time. Hedge Funds buying put insurance is like a never ending free money stream to the option writers (sellers). Contrary to what you might think ALL options are traded against the OCC, and those are backed by 160 member institutions. They make lots of money because little guys never figure it out. That's why naked buyers lose money 90% of the time.
-- So if the uptrend is confirmed by the overnight buying by whales, and the uptrend days are Monday, Wednesday, Friday coinciding with option expiration - it's pretty simple for you when to enter and exit your scalps. Get a pullback Tuesday, Wednesday is going to be great.
The reality is the market will move against the herd for 'Maximum Pain Theory' all the time. If the public is majoring in calls it will move down to reduce the counter-party payout. If everyone is in put contracts it will move up to make sure they do not get paid either. But remember hedge funds always have to buy put contracts as a derivative insurance - making the movement to the upside pretty much a guarantee over time. Hedge Funds buying put insurance is like a never ending free money stream to the option writers (sellers). Contrary to what you might think ALL options are traded against the OCC, and those are backed by 160 member institutions. They make lots of money because little guys never figure it out. That's why naked buyers lose money 90% of the time.
-- So if the uptrend is confirmed by the overnight buying by whales, and the uptrend days are Monday, Wednesday, Friday coinciding with option expiration - it's pretty simple for you when to enter and exit your scalps. Get a pullback Tuesday, Wednesday is going to be great.