TLT - Back to the Norm

Hey guys! I think $TLT is ready to re-group at $150. I am late to the party with this one, but profit can still be made for sure. I think VoEx is telling us that a rise to $150 is reasonable, and may even exceed that price this time around. [Quick summary: VoEx measures the price-directing forces on a stock and can indicate when these forces become too heavily involved in a stock's price-action. Graphically, VoEx-daily (magenta) indicates the day-to-day changes in VoEx and VoEx-trend (tan) indicates the over-all trend. VoEx indicates the greatest level of stability when it resides within the horizontal lines, shown below. When VoEx is above the line it is said that the stock has overly-inhibitory forces, and when it is negative, it is said to be overly-propagated. Let's have a look:] $TLT popped up on Deep Dive Stock's dailym market scan: https://i.imgur.com/XuklYbU.png But immediately I noticed that it had been in a gamma squeeze for 25 days, since 2021-09-22, which concided with VoEx-daily dipping into the propagation zone, and bringing VoEx-trend with it. So I became suspicious that $TLT may be ending its gamma squeeze, rather than existing in a longer-than-usual one. So let's look deeper. Here is $TLT's VoEx: https://i.imgur.com/SAUZV07.png The most prominent feature is that VoEx-trend has re-entered the stable zone between the two horizontal lines (the top line being the inhibitory line, which indicates price-aciton resistance, and the bottom line being the propagation line which indications price-action propagating). This supports the idea that $TLT's little dip is over. Looking deeper into the numbers, we can see that since the 20th (2021-10-20), $TLT's gamma squeeze has actually been subsiding (a peak net delta of -2.5 million, currently only -31,000), just as it did from yesterday to today (indicated by the '+' on the market scan). Looking towards what mitigating factors may have caused this reversion in price, it doesn't take long to notice that $TLT's recent "floor" was around $140 - the exact price that the majority of options (puts) are placed (141,415 puts at $140). On approaching $140, the delta-hedging requirements seemed to have ramped up (the puts are dealer-short) thus exagerating the gamma squeeze. One of the curious things about how delta-hedging is done is once you can identify the "black hole" of sorts that is ramping up the gamma (and thusly, the delta) you can track the progression of progressively more aggressive delta hedging as large broker dealers became nervous for assignment and premium realization. But that's a story for another time- suffice to say this delta hedging isn't permanent. So after the delta hedging requirements reached their max, it seems the price naturally re-bounded off of the floor that is the relatively large $140 put wall. The SNAP graphs for $TLT agree too: https://i.imgur.com/Yz25Ea0.png The SNAP algorithm further helps bring VoEx into alignment with that particular stock's behavior - and it seems the recent VoEx behavior is assocaited with positive gains on this stock. Although TLT is still technically in a gamma squeeze. Any surge of retail investor long calls or puts may jepordize TLT's newfound stability, but for now I think a trip to $150 is reasonable. There is a tiny wall of calls at $150, but depending on retail interest and the unwinding of the delta-hedging that was just done, I'll be watching TLT's VoEx as it approaches $150 as I suspect it may go higher. Definitly wish I had payed attention to this the first time it popped up on the market scan! Happy trading!

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TLT - Back to the Norm

bullish

Hey guys!

I think $TLT is ready to re-group at $150. I am late to the party with this one, but profit can still be made for sure. I think VoEx is telling us that a rise to $150 is reasonable, and may even exceed that price this time around.

[Quick summary: VoEx measures the price-directing forces on a stock and can indicate when these forces become too heavily involved in a stock's price-action. Graphically, VoEx-daily (magenta) indicates the day-to-day changes in VoEx and VoEx-trend (tan) indicates the over-all trend. VoEx indicates the greatest level of stability when it resides within the horizontal lines, shown below. When VoEx is above the line it is said that the stock has overly-inhibitory forces, and when it is negative, it is said to be overly-propagated. Let's have a look:]

$TLT popped up on Deep Dive Stock's dailym market scan:



But immediately I noticed that it had been in a gamma squeeze for 25 days, since 2021-09-22, which concided with VoEx-daily dipping into the propagation zone, and bringing VoEx-trend with it. So I became suspicious that $TLT may be ending its gamma squeeze, rather than existing in a longer-than-usual one. So let's look deeper.

Here is $TLT's VoEx:



The most prominent feature is that VoEx-trend has re-entered the stable zone between the two horizontal lines (the top line being the inhibitory line, which indicates price-aciton resistance, and the bottom line being the propagation line which indications price-action propagating).

This supports the idea that $TLT's little dip is over.

Looking deeper into the numbers, we can see that since the 20th (2021-10-20), $TLT's gamma squeeze has actually been subsiding (a peak net delta of -2.5 million, currently only -31,000), just as it did from yesterday to today (indicated by the '+' on the market scan). Looking towards what mitigating factors may have caused this reversion in price, it doesn't take long to notice that $TLT's recent "floor" was around $140 - the exact price that the majority of options (puts) are placed (141,415 puts at $140).

On approaching $140, the delta-hedging requirements seemed to have ramped up (the puts are dealer-short) thus exagerating the gamma squeeze. One of the curious things about how delta-hedging is done is once you can identify the "black hole" of sorts that is ramping up the gamma (and thusly, the delta) you can track the progression of progressively more aggressive delta hedging as large broker dealers became nervous for assignment and premium realization. But that's a story for another time- suffice to say this delta hedging isn't permanent.

So after the delta hedging requirements reached their max, it seems the price naturally re-bounded off of the floor that is the relatively large $140 put wall.

The SNAP graphs for $TLT agree too:



The SNAP algorithm further helps bring VoEx into alignment with that particular stock's behavior - and it seems the recent VoEx behavior is assocaited with positive gains on this stock.

Although TLT is still technically in a gamma squeeze. Any surge of retail investor long calls or puts may jepordize TLT's newfound stability, but for now I think a trip to $150 is reasonable. There is a tiny wall of calls at $150, but depending on retail interest and the unwinding of the delta-hedging that was just done, I'll be watching TLT's VoEx as it approaches $150 as I suspect it may go higher. Definitly wish I had payed attention to this the first time it popped up on the market scan!

Happy trading!

 

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read-time
3 min

150.00

Target Price

8/ 10

Confidence

2-4 Weeks

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