making sense of NDX Cash opening Print
|1 min NQ futures opening print|
|CASH.. NDX opening print.. u see the gap down|
Decent OI in the 2575’s and 2600 calls. Pushing the price against those call holders could cause them to hit the bid. See the long wicked candle in the first chart about 2 minutes before Cash opened? Sure helped inject some uncertainty and vol into nasdaq index before cash open….
now read the CBOE specifications for NDX settlement.
Last Trading Day:Trading in Nasdaq-100® options will ordinarily cease on the business day (usually a Thursday) preceding the day on which the exercise-settlement value is calculated.
Settlement Value:Exercise will result in delivery of cash on the business day following expiration. The exercise-settlement value, NDS, is calculated using the opening sales price, as determined by the Nasdaq Stock Market, of each component security on the last business day (usually a Friday) before the expiration date. The exercise-settlement amount is equal to the difference between the exercise-settlement value and the exercise price of the option, multiplied by $100
Now that you understand settlement. You should now understand why someone would have the incentive to disturb the futures price in the minutes ahead of cash open.. they were really positioned in options. short.