SPX options expiration calculation update

Here is the options calculation update, continuing from my Monday post. Because the SPX cash market has moved and open interest in the SPX options has moved; the previous target area (1370-1397) has shifted to: 1347-1398. The box has been pulled down. A bullish falling wedge has formed on the chart below. On Wednesday we saw a rally attempt fail in the first hour, but it will be rerun. Futures are also strongly up tonight (May 16), so I think there is a decent chance we make it inside the box to at least 1347 by Friday, but resistance at 1340 must be overcome first. A relief rally could carry the SPX all the way back to 1363 where there is significant resistance.

 

[Dutchy]

Wow Uptrend, 1347 bounce by Friday? That sure sounds optimistic! I understand the charts but clearing anything near 1335-1340 area will be a challenge. Thanks for posting.

 

[Uptrend]

Wow Uptrend, 1347 bounce by Friday? That sure sounds optimistic! I understand the charts but clearing anything near 1335-1340 area will be a challenge. Thanks for posting.

Thanks, but I am not saying that at all. If the market does not make it back inside the box, it means that traders that have puts are past their strike to a greater degree, and are "in the money" and winning against the house. Since the bullish falling wedge, broke down, it seems certain that the house is losing for put traders, as market forces have over powered their ability to manipulate the market. In a more normal month, I would think that the tendency would be to finish in the middle of the box. This is where the least amount of puts and calls can meet the strike price.