Directionality in markets is difficult to gauge. You have people at all levels from retail at home to quants at big firms all aiming to find an edge. Things like option flow are one tool, charts another, but how you put everything together is what determines how well your information is before you make what ends up being your final trade. I built the rankings system in the database because I always believed one trade wasn’t enough to make an informed decision with. When a name saw repeat activity, that was my signal to begin to think of how I was going to attack. You have to remember with these trades when you’re talking $1m+ is not simply someone making their own decision but the majority of the time it is the final product of lots of meetings, analyst recommendations, and traders inputs on levels. What we see is the end result of alot of collaboration deems as an opportunity to make money. Think about that for a second, each line you see in the daily chart is the end result of hours of brainstorming and strategizing. Is every single one going to be right? Maybe if you’re unrealistic about things. Look most funds don’t even outperform the market but this is where the rankings system comes into play. Take a look at the top 10 from the past month below.
Here is the Claude generated analysis of how those 10 names did vs the market. An equal weight basket would have returned 16.6% vs 1.2% vs the S&P in the past month. All but 2, Amazon and Broadcom, outperformed the market(insert Amazon joke here). The point I’m trying to make is this service is so much more than an options service. If you’re looking to swing short term options that is fine, but the main goal here is to have you looking at the right names at the right time. It’s hard to argue it doesn’t work when something like Intel has been at the top of the rankings all year and is up 230% on the year far outpacing the market at 13.5%.
Just remember, 1 trade isn’t always significant unless it is an obscure name. With larger names what matters more is how many bullish trades are coming in on a name. That is what the rankings simplify with bullish trades minus bearish trades. This isn’t rocket science, it is rudimentary data analysis but it works. This is a repeatable process, there is always a new name that is seeing a large inflow that you need to focus on. Stop judging things on a daily or weekly basis, just position properly in the right names and give yourself time, time is the key.
The most important thing is remembering that there isn’t one specific way to attack the market. There are countless approaches. Some use leverage, some don’t, some buy calls others prefer commons. Your approach is less important than being right on direction. You can have the greatest approach but if you’re in the wrong names it won’t matter. This database and ranking system is designed to point you in the right direction on what names to focus on. Just keep it simple. You have to build your own approach to this data with trial and error. My book is there every day and you can see how I approach leverage with it all built on the option flow you see. You have to find what works for you because what works for me may not for you.
I don’t like sending out multiple posts in a day so I will include a link to the database for today and it will be up until the opening bell tomorrow. You will get all the trades live as they’re logged throughout the session.
Have a good session, I will see you tomorrow morning. I don’t plan on making any changes today.