Here’s an updated version of the phenomenon that I refer to as “The OpEx Ramp”, which is the somewhat fairly consistent historical tendency of the market to rally into standard options expiration (the 3rd Friday of each month shown with the red vertical lines) with that rally typically followed by an equal or greater correctionusually beginning anywhere from the day after OpEx (which would be next Tuesday, as the markets are closed Monday) to about a week or so later.
OpEx Ramps & Fades Feb 17th
As with any indicator, pattern or other tool in technical analysis, this indicator is far from 100% effective but I find that using it in conjunction with other confirming or for that matter, non-confirming factors, such as the fact that the OpEx ramps & fades typically don’t occur when the market has just recently experienced a decent correct, as excessive bullish sentiment, overbought conditions, etc.. has been cleared out thereby paving the way for a more healthy & sustained rally, can be a very useful tool.
In the case of today’s Options Expiration, the most recent unusually powerful OpEx ramp was proceeded by a nearly equally strong ramp leading into January OpEx in one of the few rare instances (again, backing out OpEx dates in the wake of a previous correction or no ramp leading into OpEx) where the ramp was not faded, other than a relatively minor intraday dip on the first trading session following last month’s OpEx.