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Zeev Hed

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Zeev Hed

Re: nancy2 post# 270779

Friday, 07/16/2004 4:20:25 PM

Friday, July 16, 2004 4:20:25 PM

Post# of 704019
My thinking was different, I figured Max pain closer to the $36/$37 area, and when that happens, namely, the hose was wrong and they are stuck with a bunch of options they'll have to pay up for, you often get delta hedging which amplifies the move. If large chunks of puts are in the money, they sell short to cover their puts, if a large number of calls are in the money they buy the stocks. Since Max pain was above the market, delta hedging was pushing for an excursion well under $35 on the QQQ as suggested here last night (#msg-3573133). Most of the time, they manage to kill mst puts and call and close on Max Pain, sometimes, they just cannot control the beast. That is one reason early next week we should be up, since they will undo what they did today.

AZH

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