Quote from austinp:
<i>"Anybody remembers what happened to index options right before Greenspan suddenly cut 50 bps during the RTH in 2001?"</i>
I remember the April cut very well. At the time I was still trading SPX options long and short, didn't switch to eminis until mid-2002.
Had three major strikes (x25 divisor) SPX option calls and puts T&S charts on screen at all times, filtered for trades of 100 contracts minimum to watch big-money in action.
Out of the blue, call option volume blew off the scale... 100 to 500 lot SPX option blocks were streaming off the scale. Act first, ask questions later when something like that is witnessed. I was long five slightly OTM calls from 2,000ish per off the open, added five more at 1,700+ to hold ten lot trade.
Mere minutes later, the chart blew sky high and those contracts at blended average of 18+ were trading 52s in a heartbeat. I dumped into the vol explosion before the tape came back to earth.
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That was also before big players worked the ES hard. Now those block trades don't show up clearly like they once did. Factor out the obvious spreads, and it was pretty transparent when the big guns were playing insider knowledge.
Who here asked if the markets are rigged? Of course they are! That's all part of this game :eek:
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