Jun. 25 at 1:57 AM
$NFLX Call volume has been consistently high since the stock collapsed after earnings. The real game the MMs are playing is that they're buying deep ITM puts while retail traders keep chasing mostly worthless calls. Look at the 7/17
$75 put strike: yesterday, about
$24.5 million worth traded, with volume around 54K contracts and open interest at 76K. Today, open interest is down to 57K and volume is only about 440 contracts. That suggests they closed roughly 19K contracts yesterday and are still holding 57K contracts.
In my view, that's a positive sign. Market makers often buy deep ITM puts to hedge their long positions, allowing them to profit from the put side while still benefiting if the stock gains momentum and their long stock positions appreciate. They've reportedly been holding this put position since February of this year stated
$110 per contract and yesterday exited around
$460
