Options Market Wrong = Brilliant Trade Idea
By Brandon Chapman, CMT
Hey trader,
The options market on Caesars Entertainment is broken.
And it’s created an INCREDIBLE opportunity.
You see, CZR has made five three-standard-deviation weekly moves in the past year.
The options market prices those moves as statistically improbable. Yet, yhey keep happening anyway.
That mispricing creates an edge.
An institution just stepped into it with nearly 10,000 contracts on each leg of a call spread.
The Block Hunter Console flagged the spread as an opening position at both strikes. Volume exceeded open interest by a factor of 36 at the $32 strike and nearly 17 at the $27 strike.
Now layer in 17.5% short interest on the float.
That is 35 million shares that must be bought back if the stock starts to move.
The spread costs $1.40 on a $5-wide structure. The sizzle index on both strikes ran above 7, confirming that today's volume is multiples of the recent average.
Here’s how I would play it.
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An institution just built a $5-wide call spread on a stock the options market consistently underprices.
The Block Hunter Console flagged both legs, confirmed them as opening positions through volume exceeding open interest, and showed the squeeze bar lighting up on both strikes.
The Console lit up opportunities on KSS (375% in 13 days), PLUG (206% in 5 days), and VFC (100% in just 24 hours).
Missed the latest Block Hunter webinar? The replay is available now.
Click Here To Watch the Block Hunter Replay
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