$1.8 Trillion in Options Expire Today

Nothing to see here...

Once was an unknown derivative product has how become a heavily written about subject. 0DTE options. Marketwatch Article. More then one article has popped up in the last month about this short-term options product that has driven Index’s along with individuals stocks such as #TESLA higher YTD. But with popularity comes less and less profitability. Its is said that the first to adapt profit the most and the last to adapt profit the least. This is quickly becoming the case with 0DTE options.

The other element to 0DTE options is they go both ways. Up and down. The number 2 and 3 heavily traded options contracts yesterday where SPY Feb 17 $411 and $410 Put’s. SPY fell 1.38% yesterday and is not looking so good pre-market (that could quickly change with the $412 Calls being the target).

Tesla reported yesterday that it was recalling 365,000 cars to fix a self driving issue. MMM…that could be a problem along with the Wholesale Price Index going up as reported yesterday morning. The recall news drop Tesla down towards my entry point to short Tesla and very well may open below that point this morning. Subscribers, I’ll let you know if and when I take that position. (subscribe, its only $11.99 a month)

Apple, being one of the top two holdings in the QQQ ETF continue to hold up the fort but has announce that it will be laying off 3rd party vendors in the coming weeks, months. Apple has been one of the few to lay people off, yet now that seems to have started to materialize.

The economy is not good. That is becoming more and more obvious from the data that is coming out. Yet the Markets aren’t the Economy. Liquidity is was drives the Markets.

Depending on the direction of liquidity, markets will go. Today is Option Expiration. One of the biggest. $1.8 Trillion will expire today. Cem Karsan explain very well what is happening today and early next week and how this could effected markets. Cem Karsan Feb 17 OpX explanation

Conclusion

I believe the liquity that has driven these markets to where they are today is fading. With that fade comes less ability to stay afloat. Be patient, risk manage.

Live Loud!

Trent

Disclaimer

This is not advise or a recommendation.