I come across these articles a lot, and I just don't understand the depth of their analysis... https://www.zerohedge.com/markets/n...le-fuel-mechanical-short-squeeze-across-op-ex I realize we have the OpEx tomorrow... But I see so many times about "dealer-desk squeeze on gamma" and whatnot. Is what they type true, or is it all gibberish? To a layman like me, it seems they are suggesting that with no surprises at next week FOMC, there will be a huge rally because "dealer desks will have to unwind their puts" or somesuch.
I believe these guys became popular after the march ‘20 selloff, same with the endless articles about nomura. The speed of the sellof was supposed to be caused by a snowballing effect in the opex market. On another well known tradersite was a lot of discussion on this, dark pools, DX etc. I believe the main conclusion from the few guys which had real knowledge in the options market was that it’s effect could not be proven. My 2 cnts
The public has been relentlessly selling calls against their bleeding stock positions. It is giving the dealers that long gamma/short delta. Dealers don't set themselves up to get squeezed.
... I bet if I understood what that truly means, there would be money to be made. Alas, I suck. Mreh.
Goldman: Dealers are short index gamma for the first time since March 2020… Sentiment changing, put buying at 5 year highs on Friday https://www.investmentwatchblog.com...hanging-put-buying-at-5-year-highs-on-friday/