AMC - Option Level Analysis

After getting the data on Option Trading today we can see where the levels are and what the sweet spot of the Market Makers are. Their "Sweet Spot" is where they want the price to be to make the most amount of money.

This means, they dont want it to drop below the PUT levels so that they would have to pay them all out.

Vis Versa, they also do not want the price to get above the Call buyers level since that also would mean that they have to pay them out.

The today closing price and trading range will be between

Under $38 and above $35. 

There you have it. Monday will be another day. I still have to wait.

I bought another PUT since a lot of these call options and put options will expire this weekend. 

What will be the situation on Monday, next week?

Well, first of all the PUT volume is drastically reduced, which means the Market Maker will not be forced to buy back options that are in profit, ITM, PUT Options. 

Remember there are as of today about

• 260,000 Puts at $35 Strike Level
• 300,000 Puts at $30 Strike Level
• 100,000 Calls at $37 Strike Level 

Monday these potential payouts will be expired and this is what will be left!

• 13,000 Puts between $35-34 Strike Level
• 6,000 Puts between $30-29 Strike Level
• 2,000 Calls at $37 Strike level.

The Open Interest, open contracts, are greatly diminished. Market Maker will not let the price go up to $40 if they dont have to. And I do not see the potential. Even though the trading volume of AMC has increased to 171 million a day due to high trading yesterday, the Ape Army could NOT push the price up, and past $37 and then beyond $40 where all their CALL options are sitting.

My conclusion

There will be a Call / Put Ratio of around 1.62 for Monday, for every call options there are 1.62 put options. The reason for the price movement to the down side was due to PUT OPTION buyers. The reason of the price movement to the upside above $35 was due to the Market Maker.

The result was steady pric, just in their Sweet Spot.

Put Buyer were trying to drop the price by buying Puts and the Market Maker has to sell the underlaying asset to hedge their risk, so they turn the "Long-Call-Option" into a covered "Call", thats why the price drops. 

And on the other hand to keep the price up, even though there were not enough Apes to buy Calls, the Market Maker had to buy Shares in excess to balance the Put Buyer. Keeping the price steady around 35-37.

NOW, there will be a lot of excessive shares on their books and they will have to get rid off them over time, which will drop the price. 

• If low PUT trading will occur next week the MM might buy more excessive shares
• If trading volume will be low and Apes come back to buy more idiotic CALL OPTIONS the price will go up. But that chance they had in the past 2-3 weeks. Nothing happened. No more money. Burnt out fellas.
• If there will be moderate Put buying the MM might be able to cover. They will try to keep the price above the big LONG-PUT-Levels. 
• If the Put volume will increase dramatically the price will drop.

I bought a 186 Days to Expiration PUT at 37 Strike!

Fundamental Analysis wins in the long run. AMS price target is at $5.84