>>I see only high PUT volume. Don't know whether there were any blocks and it was a buy or a sell (in terms of blocks)
If PUTS were bought, they are betting the stock will go below 24 before Nov 21. If PUTS were sold then they are betting the stock will be above 25 by Nov 21.
Please remeber, for every sell there is a buy. What we are trying here to figure out how the big blocks are being traded and trying to gain some insight. <<
What is key here is how the Open Interest(OI) changed. I was tracking this daily until last week. Figures. Today 1318 contracts of CQGWE (Nov 25 puts) traded, leaving an OI of 964. On Oct13, the OI was 748. A net result of 216 new contracts in the last week. Let me add, that people buy and sell puts and calls to hedge long and short positions.
This is how OI works. When a new buyer of puts makes the contract with a new seller, the OI increases by one (a position is opened). When a new buyer purchases from an earlier buyer, OI is unchanged. When a former seller of puts buys to cover from a new seller, OI is also unchanged. Lastly, when a former seller buys to cover from a former buyer, OI decreases by one, that is, a position is closed. Got a headache yet?
We really need the last few days OI numbers to get a good indication. Todays volume was more than the OI. Did OI decrease from yesterday? Then a lot of that volume was to close positions. That kind of volume should throw up a flag to increase awareness to changing conditions (not that we are lacking in that department). |
