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Actionable news in QQQ: PowerShares QQQ Trust, Series 1,

QQQ: Monthly Expiration Week

Summary

Monthly expiration is this week.

There is a lot of open interest at the 120 and 114 strikes.

Be careful about the pinning.

Though this might seem to apply to short-term players, long-term players can benefit as well. I know the way most long-term traders play options is through the use of selling premium on their stock (covered calls) and this article will be beneficial to them.

Monthly expiration tends to have funky behavior at least that is the theory. In my opinion, it is a worthwhile theory because I have seen price plenty of times stick/pin at these levels.

It is of the utmost importance that one pays attention to the strike prices. The theory behind the strike price pinning is basically professional players are unwinding their hedged positions. Here is a pretty good explanation for those interested in the theory.

Knowing that option activity precedes price movement, let's take a look at the options chain of QQQ (NASDAQ:QQQ) for this week.

(Source: ThinkorSwim Platform)

What sticks out as a sore thumb is the open interest at the 120 strike level there are about 40,000 contracts on each side. This level will be important to watch if the trend in the QQQ continues higher. I am pretty sure many of the market participants are...


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