Last week, Market Rebellion identified thousands of bearish puts bought in Silvergate Capital. Tune in at 3pm ET as Jon highlights three stocks the smart money could be buying or selling via UOA, each day before the closing bell. Instead, understand the process by which trade ideas are chosen from the potential unusual options activity. SEIZE CONTROL OF YOUR FINANCIAL DESTINY - Get a custom-designed educational package tailored to your individual trading needs, skill level, and schedule. Whether that something is an upcoming acquisition or news on a successful (or unsuccessful) drug trial, it doesnt matter. Volume: Volume is the number of trades over a given time period. He thinks they are honest and it's his fault, and no doubt he bears personal responsibility for making trades. 2023 Benzinga.com. In the options market, thats a trade that stands out so much you cant help but notice it; a tradeor, more frequently, series of tradeswith essentially no explanation other than someone must know the stock price is going in one direction or the other. It starts out with a bit of a sales pitch (expected) but then turns to a good education of what is known as the Greeks. Every day, Market Rebellions Heat Seeker algorithm flags dozens of potential trades. Almost 16,000 contracts . It is written in easy to understand language and filled with real life examples and spot-on analogies. Their goal is to be inconspicuous. By April 14th, Musk stunned everyone by making an offer to buy the remaining shares of TWTR at $54.20 apiece. Please try again. The trade breaks even at $19.15 or 9.12% above the current stock price. Think youre ready to get started trading unusual options activity? It's a comprehensive process that takes more than just tracking large options trades using a free scanner. Jon and the entire team are very excited about this opportunity to open new doors and better serve traders like you. A company may release great news and have the stock price barely budge or even go down. If the open interest is 1, that means that there is one long contract AND one short contract. !The legend is coming to Making Money. Youre probably familiar with this first example from the first half of 2022. FOLLOW YOUR MONEY INTO JOHN AND PETES' POCKETS!- A TRUE TITLE! However, options markets are still relatively small. Such decisions should be based solely on an evaluation of their financial circumstances, investment objectives, risk tolerance, and liquidity needs. FOLLOW YOUR MONEY INTO JOHN AND PETES' POCKETS!- A TRUE TITLE! If a trade is a large notional dollar amount, traded on the offer, with high volume that exceeds open interest, well out-of-the-money, and a small likelihood of the price naturally reaching there as it relates to implied volatility, then that trade is certainly unusual. A lot of game changing information. We think about how the trade will perform as the price of the stock moves and time decay sets in. Jon Najarian noticed that options traders were buying the December $32 calls in Luckin Coffee Inc - ADR (NASDAQ: LK ). Jon Najarian, co-founder of Market Rebellion, explains the unintended consequences of 0 days to expiration (0DTE) options. We think about how the trade will perform as the price of the stock moves and time decay sets in. On CNBC's "Fast Money Halftime Report," Jon Najarian said he saw unusually high options activity in the Nov. $39 calls in iShares FTSE/Xinhua China 25 Index (NYSE: FXI ). BTW - I dont think there is an easy way to learn the Greeks. Follow the Smart Money is a page turner and will open your eyes towards better strategic trading. The Najarian brothers track the options market closely -- in this clip they reveal the unusual buying activity they're seeing. Insiders Guide: How to Trade Unusual Options Activity. The initial announcement from Elon caused Twitters stock to rally from roughly $39 per share to a high of over $54 in just 3 trading sessions. Jon Najarian has reached a mutual agreement with CNBC to discontinue his exclusive contributor contract here's where you can watch him now. Get real-time UOA trading insights and LIVE-market analysis throughout each trading day as part of our community of elite traders. All Rights Reserved. , Item Weight They picked the $15.50 strike, although the price has already jumped above that level. That doesnt mean to say that if there was large call buying activity well out-of-the-money, it wouldnt flag as unusual. Instead, they got a model of a tarp,, 1 Primary Trade Idea + Bonus Trades Per Week, LIVE Q&A Session With Lead Instructor Bill Johnson, 8 Times Retail Traders Did Something Amazing. Insiders offer one easy explanation for the source of unusual options activity. To trade unusual options activity, you have to get to the heart of what exactly makes a trade unusual. We pioneered a formula for identifying unusual options activity. , , . . That means, not only are they putting a lot on the line to make a bearish bet theyre predicting that the move will be big. On February 8, it was announced that Electronic Arts (EA) was buying GLUU for $12.50 a share, a nice premium over the $10 call options that were initially purchased. 2023 Market Rebellion, LLC. , ISBN-13 Starting in November 2020, we noticed that Gluu Mobile Inc. (GLUU) was starting to heat up. Like stocks, options have two prices: a bid and an ask. Najarian jumped in and he is going to . Why would someone seemingly throw away a large amount of money? From identifying the trade, to confirming if its unusual, to choosing the right options strategy, youll learn how to do it the way they do it. 3) They Are On CNBC All The Time The reason the Najarian brothers have so much credibility is they appear on Fast Money on CNBC. BTW - I dont think there is an easy way to learn the Greeks. If you are interested in unusual options activity because of exponential gains from front-running potential news, thats normal. But theres another explanation for the Smart Money in unusual options activity: Wall Street hedge funds, pension funds, and other big money traders amassing huge positions. All investments involve risk, and the past performance of a security, Digital Asset, industry, sector, market, financial product, trading strategy, or individuals trading does not guarantee future results or returns.Investors are fully responsible for any investment decisions they make. Pete Najarian noticed a big volume in the December $20 calls in JetBlue Airways Corporation JBLU . Catch Jon Najarian on Fox Business with Charles Payne: November 30th, at 2pm EDT, and then once again in studio on December 7th. It takes analysis and work, and then proper position sizing and management. Click here for our 3 keys to identifying potential unusual options activity in any market. If you are interested in trade ideas or alerts triggered by unusual options activity, here are some questions that you may want to consider before choosing a trade alert service: As mentioned above, trading unusual options activity based on one criterion (e.g., volume of the trade is greater than open interest) is too simple. Around 3,000 contracts of the October $19.50 calls in Under Armour Inc Class A (NYSE: UAA) were traded in the first half on Wednesday. Heres an example from February 2021. First, well define what makes options activity unusual. Get a custom-designed trading program tailored to your individual needs, skill level, and schedule. Jon Najarian, a 16-year contributor to a variety of CNBC programs including Worldwide Exchange, The Halftime Report, Fast Money, and Power Lunch, has reached a mutual agreement with CNBC to discontinue his exclusive contributor contract with the network to enable him to pursue other media ventures, including building out the programming at Market What would you like me to ask @jonnajarian on Wednesday? When we present a trade idea, we dont just regurgitate the trade that triggered the alert. The Najarian brothers recently started airing ads touting their new book and DVD called 'Follow the Smart Money'. I especially enjoyed the chapter on The Greeks, which I thought was a thorough and clear explanation, and the relatable comparison of a call option to a rain-check. GLUU is a stock that often flies under the radar of most traders so when we saw these colossal back-to-back option trades, we flagged it immediately for its highly bullish sentiment. It is a how to guide that shares . The Narajian brothers have capture their experiences identifying option trade opportunities and execute them. On this page, we will give you the insiders guide to how you can identify, screen, and trade unusual options activityjust the way Jon Najarian, Pete Najarian, and a team of our Market Rebellion analysts do. Follow The Smart Money is an excellent book for those who are interested in learning about options, the stock market, and unusual options activity. That means if youre planning on trading unusual options activity, you need to make sure youre looking at the whole picture by applying additional filters. What are the filters that the options activity goes through before it is presented as a trade idea? If youre looking to trade UOA, you came to the right place. Can is the operative word. Because of the inherent leverage that it offers, the ripples of Smart Money behavior are more easily seen by looking at options order flow than looking at trading in the stock market. Please don't even THINK ABOUT BUYING! Every time he tells me about Pete and John's unusual call option activity it ALWAYS ranks. Top subscription boxes right to your door, 1996-2023, Amazon.com, Inc. or its affiliates, Learn more how customers reviews work on Amazon. Reviewed in the United States on May 20, 2020. Its a comprehensive process that takes more than just tracking large options trades using a free scanner. The stock had fallen more than 25% in just six weeks prior to this purchase but this big buyer of 6,000 out-of-the-money February calls (bought as part of a spread) wasnt deterred. Your recently viewed items and featured recommendations. Searching for a better way to trade options? Dont be stupid though. In simple terms, you are looking for a trade that makes you say hmmm thats weird. We think about how the trade will perform as the price of the stock moves and time decay sets in. It might. 01:12 Wed, Dec 28 2016 2:36 PM EST In general, its traders or investors with a lot of resources and critically information that we dont have as individuals. There are a number of ways that a trade can be unusual: option trading volume, open interest, the date of expiration, the strike price, and the price paid. 2023 Market Rebellion, LLC. Trading based on unusual options activity works to align our positions with those of Wall Streets Smart Money, those with insider knowledge of upcoming news or important information that can move the price of a stock. The market may be expecting a large move. Benzinga does not provide investment advice. Full content visible, double tap to read brief content. Below is a chart mapping the likelihood that flagged activity will trigger an unusual options activity trade idea based on the factors that we use as inputs in the unusual options activity scanner. The bid represents the price at which someone is willing to openly buy the option. A lot of game changing information. Dont miss Making Money With Charles Payne, today on Fox Business! The options he does DD on and trades almost always do well. The Najarian brothers bring a unique perspective to trading that is built upon excellence in sports and education. Howd that play out? Supporting posts: Follow The Smart Money - Unusual Option Activity - #1 Way We Choos - VERY GOOD. Its really in how these multiple factors come together as one that makes a trade truly unusual. Starting in 2021, our Heat Seeker algorithm spotted consistent activity in Tilray (TLRY), one of the leading marijuana stocks. There is fundamental research, technical analysis, and order flow analysis. Almost 30,000 contracts were traded in the first half of the session. Pete Najarian spoke about high options activity in Taiwan Semiconductor Mfg. You may find other books as helpful and maybe more so but this is a good introduction. The expiration is covering the J.P. Morgan Healthcare Conference. Reviewed in the United States on October 19, 2020. We are sorry. On the opposite side, it doesnt mean that a large trade executed on the offer with a close expiration date is unusual. As individual traders, we focus on capitalizing while these big funds are still amassing their market-moving position. Today, shares were cut in half. Ultimately, the stock kept surging from the $9 price point to above $60, before its price ultimately fell back lower. Some sites have compiled free screeners that use a one-factor model to present unusual options activity. Instead, it is a way of trying to tilt the odds in our favor; a way of setting up a portfolio of trades with a goal of a positive return. See Also: Target Option Traders Turn Bearish Following Big Holiday Shopping Weekend. Najarian jumped in and. This article was last updated on 11/30/2022. The Najarian brothers bring a unique perspective to trading that is built upon excellence in sports and education.Follow the Smart Money is a page turner and will open your eyes towards better strategic trading. Open interest is measured once a day at the end of the day. All Rights Reserved. By clicking Get Access, you agree to receive marketing offers from Market Rebellion, and its affiliates, subsidiaries, or agents in the form of emails, pre-recorded messages, text messages, and autodialed calls at the email address and phone number provided above, even if the phone number is present on a state or national Do Not Call list. Rebels Edge 01-09-23. And these are exactly the times (ahead of major market events) that they may be active. $4.39. Whether that something is an upcoming acquisition or news on a successful (or unsuccessful) drug trial, it doesnt matter. Do Not Sell My Personal Data/Privacy Policy. One of the best investment books out there, Reviewed in the United States on January 15, 2020. These positions ultimately move stock prices in big ways, but the cause and effect may not be immediate. And that is information that we act on. Lofty Expectations Meet Lofty Valuations at Teslas 2023 Investor Day. $9.99. Theres fundamental research, technical analysis, and order flow analysis. When trying to add (or remove) a big position, these Wall Street firms will use all the tools available to them: listed exchanges, dark pools, and options markets. Unusual Options Activity Trading Guide | Market Rebellion This strategy has survived the death of the trading floor and migration to electronic trading, the rise of high-frequency trading, the popularity of ETFs and passive investing, and every other major change for the past three decades. It just means that they passed the first level test. It doesnt mean that the price of the stock will move. But, you should also realize that this is still a probability-based analysis. Everyone is looking for an edge in the market. Remember, were looking for activity that Smart Money traders are making. That means someone is making an unusually big bet (1,000,000 share equivalent) in the direction of the price. Full content visible, double tap to read brief content. In other words, the trade clearly doesnt make sense. That doesnt mean that if there was large call buying activity well out-of-the-money, it wouldnt flag as unusual. Jon Najarian: How 0DTE Options Are Changing The Market - Video - IBD You recognize that you are not required to provide this consent as a condition of purchase and that you can withdraw consent at any time. Najarian Brothers See Unusual Option - Najarian Brothers | Facebook All that matters is that they might know something we dont know and that something is expected to move the price of the stockin a big way. Learn more. Dont Make These Rookie Mistakes with UOA. Using Discipline to Trade the Stock Market - YouTube Our Free Book Helps Everyday Investors Follow the Smart Money! | Here's We, Yahoo, are part of the Yahoo family of brands. Whether we're talking about thousand-dollar donations to food banks, tables-full of video game. Lets keep up the momentum and start this next chapter with a BANG! If that order appears paired with a stock transaction, for instance, it could be a hedging transaction. Amazon.com: Customer reviews: Follow The Smart Money - Unusual Option If you are someone who doesnt learn easily , doesnt commit, or are lazy, dont kid yourself, dont buy. Reviewed in the United States on May 4, 2021. All rights reserved. Surprisingly informative. Almost 30,000 contracts were traded in the first half of the session. There are other factors that could make it less unusual. In Follow the Smart Money, Jon and Pete will teach youstep-by-stephow they trade unusual option activity every day. Customer Reviews, including Product Star Ratings help customers to learn more about the product and decide whether it is the right product for them.Learn more how customers reviews work on Amazon. Inside each of these categories, there are dozens of different strategiesmost of which go in and out of favor. If there is about to be a phase 3 drug trial announcement, it wouldnt be unusual to see implied volatility very high. But, unusual options activity isnt a magic bullet. Benzinga does not provide investment advice. From there, we filter even further with a mixture of the criteria above. He'll do the same exact position that is highlighted as unusual option activity. During decades of trading this activity, Jon and Pete Najarian have honed their strategy, automating much of what they learned into a proprietary Heat Seeker algorithm that scans the order flow at all of the options exchanges. Theyll be talking options trading as they break down the latest market action in the midst of a jam-packed week of earnings. One of the best investment books out there, Reviewed in the United States on January 15, 2020. Pete Najarian spoke about high options activity in Taiwan Semiconductor Mfg. Jon and Pete Najarian have traded UOA for more than 30 yearsfrom when they were on the floor of the Chicago Board Options Exchange (CBOE) to today. Theres nothing wrong with that; its just not unusual options activity. Jon Najarian, Pete's brother, was a trader who got Pete into trading. And to do that, they have to try to mask their activity. Bei der Nutzung unserer Websites und Apps verwenden wir, unsere Websites und Apps fr Sie bereitzustellen, Nutzer zu authentifizieren, Sicherheitsmanahmen anzuwenden und Spam und Missbrauch zu verhindern, und, Ihre Nutzung unserer Websites und Apps zu messen, personalisierte Werbung und Inhalte auf der Grundlage von Interessenprofilen anzuzeigen, die Effektivitt von personalisierten Anzeigen und Inhalten zu messen, sowie, unsere Produkte und Dienstleistungen zu entwickeln und zu verbessern. , Paradigm Direct LLC; Standard Edition (January 1, 2018), ISBN-10 Is it going to require an update to the VIX calculation? However, a more common unusual options activity trigger is not so obvious. Yes, that means that we pay more than if we bought out-of-the-money options, but it also means that we lower the amount of potential profitability. On CNBC's "Fast Money Halftime Report," Pete Najarian said options traders were buying the Sept. $9 calls in Bed Bath & Beyond Inc. (NASDAQ: BBBY). Built for fast-paced traders. On February 8, it was announced that Electronic Arts was buying GLUU for $12.50 a share, a nice premium over the $10 calls that were initially purchased. Trading based on unusual options activity works to align our positions with those of Wall Streets Smart Money, those with insider knowledge of upcoming news or important information that can move the price of a stock. Reviewed in the United States on October 26, 2020. In Follow the Smart Money, Jon and Pete Najarian will teach you how they trade unusual option activity every daystep-by-step from identifying the trade, to confirming if it is unusual, to choosing the right options strategy. During decades of trading this activity, Jon and Pete Najarian have honed their strategy, automating much of what they learned into a proprietary Heat Seeker algorithm that scans the order flow at all of the options exchanges. Starting in 2021, our Heat Seeker algorithm spotted consistent activity in Tilray, one of the leading marijuana stocks. Everyone is looking for an edge in the market. All investments involve risk, and the past performance of a security, Digital Asset, industry, sector, market, financial product, trading strategy, or individuals trading does not guarantee future results or returns. When Wall Street moves into (or out of) a stock, the smaller options market is often the first place its noticeable. But theres another explanation for the Smart Money in unusual options activity: Wall Street hedge funds, pension funds, and other big money traders amassing huge positions. Follow the Smart Money Review: Unusual Options Activity Ready to trade? This is not a waste of time. Sponsored.