NOT-ADVICE of course.I have a theory, based off of looking at max-pain for every week going out to 10/8.
This week I think that $700 call wall will disapear at some point. Guessing when SP drops close enough for whomever to take nice enough profits. When that happens it's game on for run to $750 to close the week.
Looking out further to 9/24 I'm being careful as it could run to $800 easily as there doesn't seem to be any calls impeding.
10/1 is a $800 small-ish call wall at 2.8k, but could disapear as well.
10/8 $800 call wall 4.9k.
The next few weeks look great for selling aggressive puts. I'm going to be very conservative with selling calls
And EDIT: I pulled this apart from my previous post as they're too different, and WAY too big
An observation I have about max pain and the put/call walls. The monthly expirations, such as this week, , behave differently than other weeks in some ways, and the same way in others.
The different ways is that there is a LOT more $ on the line this week. When I looked at this when the shares were 750ish last week with max pain at $690, the MM were looking at $2.4B payout versus max pain payout around $1.6B ($800M difference is what I remember clearly - the other numbers are intentionally imprecise ).
The 6/10 expiration had a fraction of that. 9/24 has a max pain of 735 right now, with $50 away from the strike (785 strike) representing $116M payout vs. the 735 payout of $73M. Right now, next week has $60M on the table. Max pain exerts a LOT more gravitational pull during monthly, and especially quarterly, expirations. And we see how strong of a pull the weeklies have when volume is low.
This is how the monthly and quarterlies are different - so VERY much more $ on the line.
They are more the same than not though, in that max pain has little influence the week before expiration. Especially the weeklies - any put / call walls that accumulate trivial in size to what builds during the week of expiration. For 9/24 expiration there is an unusually big put wall at the 700 strike with .. 16k contracts. I say unusual as I rarely see >10k the week before. The big call wall is at 800 strike and is .. 2.7k contracts.
So I say that to say two things. Monthly and more so quarterly expirations - bigger contract counts, bigger contract accumulation prior to the week of expiration, and thus bigger impact.
Be very cautious using the max pain / put wall / call wall / OI / etc.. information before the week of expiration. The numbers are trivial compared to what will happen the week of expiration (I personally ignore the info, and mostly still ignore it on Monday).