Monthly OPEX is the third Friday of each month. A large amount of open interest expires at once, and the days around it often trade differently from the rest of the month.

Before OPEX

In the run-up, dealer positioning is at its largest. With big gamma near the money, the market is often more contained. Vanna and charm flows can also add a steady drift, which is why OPEX weeks frequently feel heavy or pinned.

On OPEX day

• Morning volume can be high as positions roll and close.

• Big strikes can act like magnets through the day.

• After the morning settlement for some products, part of the positioning is already gone.

After OPEX

Once those options expire, the hedges tied to them are unwound. The market loses some of its stabilising flow. The week after OPEX is often when larger moves start, in either direction.

A simple checklist for OPEX week

1. Mark the largest strikes and where max pain sits.

2. Watch volatility. Falling volatility into OPEX usually supports the market.

3. Lower expectations for breakouts before Friday.

4. Be ready for wider ranges the following week.

That wraps up our options series. If you are new, start again at Episode 1 on the gamma flip, then bring it all together with the Options page in the HOC Terminal.