In this week’s edition of Option Flows, Tony Stewart is commenting on the recent market movements.
A fragile truce to parry grotesque rhetoric rallied markets with a sense of relief. BTC very short-term Calls + structures bought.
BTC Puts dumped and/or rolled up. Implied Vol at first remained firm but drifted as confirmation from all sides was announced. Markets on edge.
The material trade going into Easter was a structure that included buying Apr24 61+62k Puts. On the announcement, these were rolled up premium neutral, so reducing notional by >55% to the 65+66k Strikes.
An April10th 74-76-78-80 Call condor played for further imminent upside.
Skew firmed from -ve Calls to nearer flat in the <7day bucket as FOMO Call buyers entered.
The April structure that net sold Puts softened the Put skew in the 2-4week area.
Overall, Put Skew remains positive due to continued doubts over the truce, Calls -ve due to net sales.
IV predictably firmed from Easter Theta discounted lows, and was bid into the Trump deadline.
On the announcement, IV remained firm on doubts of the validity from all sides despite market rallying. This gave a rare perfect opportunity for long gamma players to exit Delta+Vega.
See original post on X here.
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AUTHOR(S)
ex-MS Head of Trading desk /BTC Vol. Prop trading /Option Market forensics/ Alter Ego account Digital Asset arena. Tweets are my opinion, not financial advice.