Last week here I wrote about the high calls for both the Wednesday and Friday SPY expirations. I wrote that if price were to open or get above them NOT to fight it and that it could even push price up faster due to delta hedging. If you are going to use the open interest as a tool to trade then you have to be aware of the nuances and when not to aim for a pin. Last week was one of those times which I clearly wrote about before the week began.
SPY-W: (44 of 56 pins since Wednesday expiration inception).* The current best pin is around 245.5, but it can easily change as it’s not where the major strikes are. The key take away is that price is unlikely to close over 256 at Wednesday’s expiration. Recently price has been able to close over its high calls, but 1) it began the week over its high calls and 2) usually after a couple times of doing that the market takes a bit of a breather to consolidate.
SPY-F: (34 of 50 pins since I began tracking Friday’s).* The key takeaway for Friday’s expiration is there is plenty of room to run higher without call resistance and there is very good put support should SPY pullback to the 250/251 area.
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Wednesday 10/04: Failed pin to upside.
Friday 10/06: Failed pin to upside.