Harness Deep Market Internals on the SPX
Trading the SPX Options has several advantages.
- The SPX is a snapshot of activity of all 500 of its component stocks
- SPX Options have several expiries in a week, so there’s a lot of flexibility
- SPX Options are Cash settled, so no worries about Stock assignment
- The SPX Index has a Deep set of Market data for analyzing its Internals
- Market Internals define the “Breadth” – a wholistic view of strengths and weaknesses
- Market Internals also define the balance of power between Buyers and Sellers
Market Internals Indicators
There are several Market Internal indicators available on many platforms. The $VOLSPD for example, provides the difference in Volume between stocks that are Up and Stocks that are down.
The Advance Decline Ratio tells us how many stocks in the S&P 500 are Advancing and how many are Declining, the total coming to 500.
The $TIKSP tells us how many Stocks are Ticking Up versus the Stocks ticking down.
Taking things one step further
While these are very good Internals indicators, if we can find a way to go one level lower and use Algorithmic power to make more sense and more meaning from Market Internals, it can give a serious EDGE to every SPX Options trader. The Webinar recording below is one such Deep-Mining indicator that can provide a significant insight into the state of Market Internals, resulting in superior trades and profits. This indicator is specifically useful for trading the SPX Options Intraday with some powerful results.
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Hari Swaminathan, OptionTiger.com