Gary LeBlanc + 50 GL February 2, 2020 Feb 1 2020 As of the close on Jan 31 2020 the WTI options market is heavily weighted towards the puts side of equilibrium. With $1.366 billion in put premiums in the March contract as compared to only $397 million it gives a Put/Call Premium Ratio of 3.44. 1.0 is "equilibrium". The "imbalance" in the options pool is $1.366B - .397 = $969 million dollars. That is an opportunity for the market makers to take advantage of by "rallying" the price of WTI. By rallying the price of WTI the "$1.366B" will start to shrink as put holders exit. Bearish for the price of the put options themselves. Before WTI can "rally" however, it will need to establish a base for 7-10 trading days at least. My definition of "building a base" is for WTI to trade in a sideways pattern. Friday's high was $53.36. Until the daily low exceeds 53.36 that is considered base building. This erodes the value of both the puts and calls. Quote Share this post Link to post Share on other sites
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