Here is my speculative answer to your question on QCOM
with other related musing from this bear.
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This morning's insanity held - thank god.
There could be another bear shakeout attempt tomorrow.
I hope not.
Let's see why the rally died right where it did.
If we break resistance then delta hedging will send us soaring. ng
Nov options:
AMAT Calls 15,000 7,000 1,000 at 40 37.5 35
AMAT Puts 2,200 2,200 9,000
Any doubt why this turned today?
NVDA - look at the crooks.
Look at the NVDA news today.
In fact it was a supurb play actually.
Huge buyer of puts at strike 45.
That person was long and wants to bail IMHO.
Those puts will let the NVDA holder to bail with impunity.
Best guess is a tank on NVDA - AFTER expiry. Someone watch the volume on this to see if it is enormous with NVDA going sideways to slightly down from here to expiry. Without those puts would it have been "sell the news". I think so.
QCOM Calls 22,00 24,000 14,000 at 60 55 50
QCOM Puts 1,000 4,000 22,000
This one had me perplexed.
It is clear now (I hope)
NVDA is the clincher for me.
Someone wants to sell and sell big.
That someone wants a floor to get out.
How to provide the floor.
Load up on puts.
The MMs that hold those puts will walk this turkey up then down as slow as they possibly can, allowing the QCOM seller to exit at will gracefully.
Those puts were a recent purchase - just in front of earnings. Someone knew earnings would suck, bought puts to provide a floor, and is now selling like mad. The alternative is, someone knew - got greedy and loaded up on near term puts too close to expiry and is getting burned by being greedy.
EMLX max pain by my eyeball analysis is 25.
That is why every breakout attempt stalls in its tracks.
Again.
Pain works until it does not.
It is quite reliable just before turns or in a sideways market.
Right now it appears we are turning. I hope.
Pain is very very unreliable just after the turn (on a major reversal), or in the middle of a strong counter-trend rally.
Do not attempt to do this on MSFT (closes above pain 75% of the time), or is something looks enormously off.
INTC pain appears to my eye to be 25.
INTC closes at pain right on the money almost every time.
I am having a hard time thinking it gets to 25.
There is a huge number of calls on INTC at 27.5 (nothing like 25 however). This might suggest a close between 25 and 27.5.
If this sucker drops to 25 in week, never doubt pain again.
I will leave it to you to try some more.
Like anything else, this is a tool that when applied at the right time is useful, at the wrong time is INSANELY wrong.
This APPEARS to be a good time for it.
I would want all my trades from here to expiry on the side of pain.
This does not apply to low float, low optioned, crap.
M |
