You can’t get a little bit pregnant.
However, that’s not stopping the market from having commitment issues.
Yesterday, the OCC cleared 55,382,002 contracts. The 2026 average runs around 70 million, and even August has been at 69 million.
15 million contracts light, on a Tuesday, in the middle of a normal week.
It’s the lightest session I’ve seen all year.
What that volume is telling you
Every contract that trades has a chance of becoming open interest. Somebody buys a call, somebody sells it, and if both sides hold, that position sits there overnight and lives on the board.
Open interest is a commitment, which is to say real money picked a price and put something behind it.
When millions of those pile up around a level, they anchor it. The people who own them hedge, the dealers who sold them hedge, and all that hedging pulls price back toward the strikes where everything sits, which is why markets grind in a range for weeks.
Now flip it.
15 million contracts light means nobody is committing anything at this price, so no positions get built, no open interest accumulates, and nothing gets anchored.
And you get a couple of days trading the exact same price with nobody willing to commit, you can move enormously off those levels.
The difference between 70 million and 55 million is way bigger than you think. You look at it and go, it’s only 15 or 20 million contracts, so what.
Sooo EVERYTHING.
Why it feels so calm right now
Data came out yesterday morning and nobody gave a crap. It spun the tape around for about four seconds and went right back to sleep.
Advance decline line sitting at 50/50, with VIX and vol futures both flat. Ain’t no feel, ain’t no rhyme, no reason.
None of that is a market at rest. It’s a market where nobody wants to own anything until the man in the shiny leather jacket speaks tonight, so they’re all standing there with their hands in their pockets.
What to do with it
Do not chase.
You get a cash open like the one we had today, Nasdaq rips higher in the first two minutes, and then just craps out.
On a thin tape, moves can reverse quickly.
So watch the volume before you watch the price.
When contract volume comes in that far under average for two or three sessions running, you are looking at a market with nothing underneath it, and the next real move is going to be a lot bigger than the tape is telling you.
Anyway, while we all sit here waiting on Jensen and that leather jacket to tell us the fate of the market, you may as well do something useful with the afternoon.
Thursday at noon Eastern I’m walking through the strategy I’ve used to hit 30% or better inside 30 days. And somebody in that live room is going home with $2,000 just for showing up.
To your success,
Don Kaufman
