After Friday’s sharp price move to $73.25, we looked at options activity for any clues to what the market might be looking at away from the current price… In our podcasts and other comments on this blog, we have pointed out that the market has been trading strikes way above current prices including $100 (we assume that these are mostly initiated by buyers)… Here is the CME’s Most Active Strike tool which now shows 3 strikes in the top 20 for open interest that are $100! These have been accumulating over the past year..
A look at a price chart from barchart.com shows us a crude market that has been in a range but recently (post-OPEC meeting) has rallied sharply:
And, here is the CME again, showing just Friday’s options action based on top change in open interest… Note that around 200,000 traded, pretty much evenly between puts and calls… But net change in open interest was much greater for puts, 39,000, than calls, 17,000… So, a sharp move higher in price, after a week of rallying gives us a day in which put open interest goes up more than calls… Could mean nothing, but we’ll see…
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