Apple podría ejercer presión a la baja en el mercado
El pasado jueves 3 de agosto de 2023, Apple anunció sus resultados financieros correspondientes al tercer trimestre fiscal de 2023...
Quadruple Witching is a Magical Day for Markets
2022-11-23 • Actualizada
Besides US Retail Sales data, Australian Unemployment Rate and New Zealand GDP this week will bring us Quadruple Witching – one of the four most important days of a year for futures and options!
What is witching day about?
Quadruple witching refers to four days during the calendar year when the contracts on four different kinds of financial assets expire. The expiration date is the point at which a position automatically closes. In other words, traders will have to decide what they want to do with their open position before the expiry date. The days are the third Friday of March, June, September, and December. The assets are:
- Stock index options
- Stock market index futures
- Individual stock company options
- Single-stock futures (not commonly traded, was called triple-witch before these were introduced)
Options contracts also expire monthly. Futures contracts expire quarterly. Because traders and institutions run out of time at the close of trading, there is a lot of portfolio re-balancing, contract rollovers, and more. The last hour of the trading session (22:00 to 23:00 GMT+3) is when the volatility really increases, and assets swing dramatically.
Is it tradeable?
Because all four types of contracts expire on the same day, the quadruple witching day is usually accompanied by bigger trading volumes and volatility. On June 18, 2021, a quadruple witching day, a near-record volume of single-stock equity options was set to expire at the end of the day in the amount of $818 billion. As a result, a near-record of single stock open interest of about $3 trillion stood on June 18, 2021. Open interest refers to how many contracts are open during any given point during the day. It is an important metric for traders to watch since a large amount of open interest can move the value of the underlying stock.
But you need to know, that these Freaky Friday days (the second name for the day is even stranger than the first) in general are not bullish or bearish. You cannot just buy or short sell and make guaranteed money. What is guaranteed, however, is that there will be a big surge of volatility. There is on average 40% more volume on this day than the average.
Source: https://www.bloomberg.com/news/articles/2020-09-18/stock-traders-brace-for-quadruple-witching-amid-options-anxiety?sref=qgDWnyMx
Also, note that the last hour of the session is usually bearish because long positions are prevailing against short ones, and closing these trades might cause a plunge in prices.
What to trade
US 500 and US 100 will be more volatile this Friday. Because of trading volumes, US 500 index will be able to reach distant resistance at 4370 or plunge through the 4450 level (if the Index doesn’t do this earlier this week).
The same goes for oil, gas, and gold, so keep an eye on XAU/USD, XNG/USD, and XBR/USD. Brent oil is surging for several days already, so we may see strong pullbacks to the $71 level.
In stock market, consider trading such companies as Tesla or Alcoa because they either have huge options volume or are commodity-based. Moreover, Alcoa is on the rise because the aluminum price is skyrocketing. Both rise to $52 and plunge to $46 levels are possible.
Similar
Ideas para operar acciones en julio de 2023
Continúa el repunte de los principales índices bursátiles de Estados Unidos en 2023, especialmente el índice Nasdaq 100 y el S&P 500, aun cuando la Reserva Federal ha mantenido un elevado ritmo de aumentos de tasas desde marzo del 2022…
¿Qué esperar tras el reporte de ganancias del 4T 2022 de Tesla?
Ganancias estimadas por acción (EPS): 1…
Últimas noticias
EURUSD: Buscando liquidez en zonas de venta de la semana. Niveles clave de entradas y salidas
Escenario bajista: Ventas por debajo de 1.0820 / 1.0841... Escenario alcista: Compras sobre 1.0827...
XAUUSD: En zona de oferta. ¿Hasta donde considerar el próximo retroceso?
Escenario bajista: Ventas por debajo de 2200 / 2194... Escenario alcista más próximo: Compras sobre 2197... Escenario alcista tras retroceso: Considera compras en torno a cada zona de demanda...
US500: Una corrección más extendida hacia 5192 antes de retomar compras
Escenario bajista: Ventas por debajo de 5220 ... Escenario alcista: Compras sobre 5225 (Si el precio falla en romper por debajo con decisión)
