Options Speculation
I have not seen numbers like these before (at least not for a long time)
Enormous bets on the QQQ.
Check it out for yourself and see.
quote.cboe.com
Make sure you have all as opposed to current box clicked.
Remember that each option represent 100 underlying shares, 100-1 leverage on a QQQ bet.
I count over 1 million OPTIONS on each side.
That is a 100 million share bet on each side.
100,000,000 shares of QQQ are bet in december options, on each side.
At $27 per share that is $27,000,000,000 bet.
Is this lunacy or is this normal?
(Note this is not really accurate cause the QQQ is not going to zero tomorrow unless the world blows up and then who cares, but I think you get the idea of the magnitude).
This happens month after month but this month is really really obscene. Is there any wonder that extremes get stretched one way and oversnap the other. As long as money keeps pouring in, someone has to keep buying so they do not lose their ass on covering 100,000,000 shares of QQQ.
I do note that max pain is slowly creeping up here. It was a solid 24 a week or so ago, a couple days ago it was a 24 25 26 tossup (with 25 the favorite). Today it is a 25-26 near tossup but closer to 25. As long as it keeps rising, bulls are in contol and 1 million puts are going to money heaven. 1 million puts.
Am I in fantasy land or is this absurd?
OTOH close to 500K calls are going to finish ITM IF we were to close right here.
Already we can see that someone is going to make out HUGE regardles of what happens here. At QQQ 26 a mere 150K puts more or less will be ITM and about 300K calls will be ITM. That would expire 1.5M out of 2M total options worthless.
I am going out on a limb here.
Not sure exactly where maximum pain will be, but I bet for the first time in a long time, we close right smack dab on it.
M |
