Mkt Correction+ OE play

oldpigwang

Mkt is in correction, 5-7% pull back from the high. So it equal to sideway + slight down pattern till end of Sep,
From daily chart, the current swing is near top, may switch to down swing in 2 days, and the down swing play may take another 4-5 days. But at the same time, we have OE play with spy max pain point sit at 100, 3pt below current price, but for the last 2-3 month OE play, mkt ignor pain point, move up crazely in oe week.
Can somebody tell me how will the mkt  trade next week which is OE week?

yaobooyao

Market will kill bears with new high, all Option bets on put side will be dead. Just like what happened in August.

I really doubt your idea of the 5~7% correction, that might happen after 1050 is reached.

oldpigwang

2# yaobooyao
How much do you think?

xiaoyaoxl

current spy max pain is 93...

yaobooyao

2# yaobooyao
How much do you thinhttp://www.hutong9.com/viewthread.php?tid=59878k?
oldpigwang 发表于 2009-9-9 12:29

I did some statistics analysis here:

http://www.hutong9.com/viewthread.php?tid=59878

You can see after recent pull back, the TA indicators are in good shape for a rush to 1050 new high.  

Further more, you can check how many percentage market went up after each pull back, and it's cycle of days, those history info doesn't support a pull back from here.  Plus this week is very light with key economic data release (which could possible trigger a sell-off).  So overall the odds of pull back is low.

Anyway,  I found I am 'DA FAN ZHI' most of time.  But I'm confident holding my solar stocks until SPX reaches 1050. That's my plan.

I am a little frog

YMYD

yaobooyao

current spy max pain is 93...
xiaoyaoxl 发表于 2009-9-9 12:34

I am confused with the calculation of MaxPain all the time.  

Look at the heaviest OI, they don't support a maxpain below 102.

Calls	Last Sale	Net	Bid	Ask	Vol	Open Int	Puts	Last Sale	Net	Bid	Ask	Vol	Open Int
09 Sep 102.00 (SWG IX-E)	2.44	+0.51	2.41	2.44	3929	106489	09 Sep 102.00 (SWG UX-E)	0.84	-0.42	0.84	0.85	13287	128446
09 Sep 103.00 (SWG IY-E)	1.72	+0.39	1.71	1.73	10893	164869	09 Sep 103.00 (SWG UY-E)	1.20	-0.54	1.19	1.21	9241	54021
09 Sep 104.00 (SWG IZ-E)	1.13	+0.27	1.13	1.15	15329	106482	09 Sep 104.00 (SWG UZ-E)	1.70	-0.62	1.67	1.70	2118	26248
09 Sep 105.00 (SWG IA-E)	0.70	+0.18	0.69	0.70	4710	121172	09 Sep 105.00 (SWG UA-E)	2.26	-0.79	2.28	2.32	724	22101

A shake up between 103~105 might kill those bull/bear bets in OE week. MM always have some tricky game plan to kill others. I saw the story happened in August OE week, what MM did is TNND 真漂亮。

oldpigwang

[url=http://www.hutong9.com/redirect.
spy max pain pt =100

oldpigwang

6# yaobooyao
Thank u for the wonderful work. Currently we have heaviest volumn calls and puts at spy=100,
with spy sep 100 call =120000, and spy sep put=197,000
also http://www.optionpain.com/MaxPain/Max-Pain-CBOE.php gave us spy max pain pt=100.
How do u feel MM did beautiful job in Aug oe week? I was wondering why mm helped call so much in that OE week. Please help me to understand it.

yaobooyao

6# yaobooyao
Thank u for the wonderful work. Currently we have heaviest volumn calls and puts at spy=100,
with spy sep 100 call =120000, and spy sep put=197,000
also http://www.optionpain.com/Ma ...
oldpigwang 发表于 2009-9-9 13:38

It's the Open Interest that matters, volume is less relative.
See today's CBOE quote,  SPY call heaviest OI is at 103 and Put heaviest OI is at 102.   But this put / call OI is very dynamic during OE week and changes huge with the market volitality, always MM make some fake move to the wrong direction just to trap the others. That is exactly what happened in August.

By the way， I know very little about Option trade.  Just my 2 cents.

xiaoyaoxl

4# xiaoyaoxl


这个max pain数据是错的（因为混入了9月底截止的option数据），下个OE的max pain的确是100 左右

trend

假设赌OE跌怎么玩法既安全又有效率？

oldpigwang

11# trend
玩最后几天的put

火凤凰

As I know max pain really works for a while before everyone knows it. But after 2007 crash, you can ignore  it until it works again.

90ufo

even experienced day-trader suggest a dayoff on the OE day, esp. the coming friday is a quaduple witching day.

For august, no one i know predicted one week before OE that SPY would be OE at 102.97.   I mean "one week before OE", not "3 days before OE".  most were expecting ~100-101 based on OI readings. most expected friday closing won't change much from thursday closing 100.99.

yaobooyao

even experienced day-trader suggest a dayoff on the OE day, esp. the coming friday is a quaduple witching day.

For august, no one i know predicted one week before OE that SPY would be OE at 102.97 ...
90ufo 发表于 2009-9-10 23:12

I meant I saw the whole story happened in Aug OE week, from MHP perspective, that MM really did some good trick. It's like watching an action movie.

I don't touch Option.

oldpigwang

15# yaobooyao
Aug a spy call was 0.25 on Monday of oe week was $2.5    4 or 5 day later, no risk to play.
Hw about this OE week?

yaobooyao

15# yaobooyao
Aug a spy call was 0.25 on Monday of oe week was $2.5    4 or 5 day later, no risk to play.
Hw about this OE week?
oldpigwang 发表于 2009-9-11 10:55

I really don't know, if I knew it, it's like I can get the lottery numbers of the weekend.

Here is my guess -  If spx 1050 can be reached next week,  a bounch of people will jump in to start short (a lot expectation here is 105x is a top). But the MMs don't like this idea, and they will kill the bears once again, so that to propel the market higher. Same story as August.

Anyway, bet on Option is very risky, it's a tool of hedging not gambling.  Good luck.