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  • bacbacker3 bacbacker3 Dec 28, 2012 3:59 PM Flag

    Over 14,000 $22.50 call contracts traded today... speak well for upward motion...

    Isn't it possible to tell from the open interest numbers whether it was a buy to open or sell to close? Anyone keep track of the open interest?

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    • It is true that a
      "TO OPEN" transaction increases the OPEN INTEREST
      "TO CLOSE" transaction decreases the OPEN INTEREST

      The problem is that the
      "TO OPEN" can be a SELL or a BUY instigated transaction.
      "TO CLOSE" can be a SELL or a BUY instigated transaction.

      The next day OPEN INTEREST is
      todays OPEN INTEREST + all TO OPEN transactions - all TO CLOSE transactions.

      There could be a mix of open and close transactions.

      Today I could SELL TO OPEN some call options early in the day and then BUY TO CLOSE near the end of the trading session for a profit. I think there are people who do same day buy/sell of options.

      Even the option sites make simplifying assumptions that are guaranteed. I think they can see if the transaction takes place at the BID or the ASK and which way the stock and volatility is going.

35.15-0.28(-0.79%)Oct 21 4:00 PMEDT