UOA revolves around the trading of option contracts at volumes significantly higher than their daily averages. The allure of UOA lies in its potential to uncover market insights and potentially ride the coattails of informed traders -It is data that we tracked and traded with for a number of years in the Trader’s Thinktank. However, as we'll explore, this approach has lost some of its luster.
Triple Witching and SPX 0DTE: Unveiling Market Mysteries Amidst Soaring Options Volumes
A recent phenomenon that has been making waves is the peculiar performance of the S&P 500 on Triple Witching days. Over the last 15 occurrences, the S&P 500 has experienced declines in a staggering 13 instances. This raises questions and piques the curiosity of market participants and analysts alike. What could be driving this pattern, and how does it intertwine with the surging volumes in the world of options trading?
Options Flow Trading: More Noise Than Signal
Options Flow trading has gained popularity in recent years, with various sites and tools attempting to capture and analyze the data. For multiple years, options flow data and option sweeps were something that we tracked in the Trader’s Thinktank. However, after tracking this data for 6+ years, it's clear to me that options flow and option sweeps have lost the edge they once provided. There are significant reasons why following the options flow is no longer worth your time.
