I use it to get an idea where the stock price is most likely to move, especially the weeklies that expire on Friday. Most hedge funds are sellers of the options, trying to capture the premium, so if you see a high number of calls traded, for example, you can assume that they are trying to bring the stock down to that price. Then I will go short, and try to ride along. Same for puts. If there are a high number of puts being traded and the stock price is below the put strike price, I will assume that they are going to try to get the puts to expire worthless and bring the price up. The intra-day charts are very useful to see when these moves will begin. If the options are very cheap, I will buy them also, but only on Fridays when the time value is almost gone. Otherwise, the options are too expensive and are a terrible value. AAPL has been great for this type of trading. It is really manipulated on most Fridays.
Good for you. Don't trade options. High probability of most options expiring worthless unless you know for sure which way the stock is being swung. But hedge funds use them to juice returns by buying/selling the stock to take the options into or out of the money. Watch a stock like AAPL on Friday weekly expirations. It's funny how a $125 stock can have its price stopped on a dime -- and I do mean a dime.
Actually, I just looked at the open interest on the Jun 19 $70's -- there's 13,000 calls open -- so it's more like $20 million that was made. That's not even suspicious; that's a certainty that there was insider trading going on.
Not only is this pump and dump, it is insider trading. There were 6,800 $70 Jun 19 calls bought the day before yesterday. Somebody knew this announcement was going to be made. If the SEC investigates this options activity, this stock will tank hard.