This 87% Accurate “Wave Indicator”
Has Just Started Flashing On A New Ticker!
Tuesday, October 7th
“The bus roared on.
I was going home in October.
Everybody goes home
in October.”
– Jack Kerouac
Major Market Events
- Gold Tops $4,000 For the First Time Ever — A flight to safety and alternative assets has caused the yellow metal to surge over 50% year-to-date
- “No Back Pay For You” — White House says Federal workers’ back pay during shutdown is not guaranteed
- AMD Comes From Behind To Mount AI Challenge — The former underdog pivoted from video games to data centers to challenge former top dog, Intel
🤔 My Thoughts
Spotting Late-Day “Sweeps”
Late-Day Orders I Trust—and the Ones I Ignore
Last week I showed you why I watch the final 30 minutes for big options orders (“sweeps”) and how I use tiny, defined-risk spreads to try to capture the next morning’s move.
Today I’m giving you the missing piece: exactly how I spot a real sweep … and maybe more importantly, and what I ignore.
First: What A Sweep Really Is
A sweep is a rush order that gets split across multiple exchanges to fill fast. To me, that urgency is the tell.
If someone’s trying to get an order of a certain size done right now near the close, I want that on my screen — especially if the trend already leans in the same direction.
My Late-Day Scan Window
I run this scan late in the day — anywhere from about 3:30pm to 3:55pm Eastern. That’s when the kind of intent I’m looking for shows up.
Earlier in the day, lots of flow is noise or hedging. Near the bell, the “we need this on before tomorrow” prints are easier to see.
As Jack Carter who has been on the show many times often says, “Amateurs control the open. Pros control the close.”
How I Separate Sweeps From Background Noise
I use simple, repeatable checks. You don’t need fancy tools — just a little discipline.
1) Direction has to match the tape.
If price is strong into the close, I want to see calls lighting up. If price is weak, I want puts. I don’t fight the price action.
2) Size and speed.
I’m looking for clusters of trades that hit quickly — multiple prints in seconds — not a lonely one-off. The bigger the notional, the better.
3) Where they hit the spread.
Real urgency tends to lift the ask on calls (or hit the bid on puts). Mid-prints can be fine if the cluster is decisive, but bid-side calls or ask-side puts are usually hedges, not intent.
4) Volume vs. open interest.
When today’s volume in a contract is larger than the existing open interest, that’s fresh positioning — more interesting than rolling old trades.
5) Expiration and strike sanity.
I prefer near-dated contracts (days to a couple of weeks) and nearby strikes. Way-out-of-the-money or far-dated prints are often hedges or structured spreads you can’t see.
6) Avoid the elephant names for this tactic.
I rarely use this on huge ETFs (SPY/QQQ/TLT). There’s so much hedging that the signal gets muddy. I want liquid single names with clean charts.
WHAT I IGNORE
- Balanced call/put flow in the same name — usually hedging.
- Random morning prints with no cluster or speed.
- Choppy charts where the stock can’t hold a direction on the 10-minute view.
The Quick Chart Check
Before I place anything, I flip to a 10-minute chart and ask one question: Is this a trend → pause → continuation setup? If price is stretched and sloppy, I pass. If it’s trending, paused, and pushing again as the flow hits, that’s the green light.
How I place it
If the flow and chart agree, I’ll use a small debit spread in the same direction as the sweeps (call spread for upside, put spread for downside).
I keep it one or two strikes wide, with just enough time that a normal open isn’t make-or-break. The cost to enter the trade is my max loss. I size it so a full loss wouldn’t rattle me.
Exit plan: If I get a favorable opening gap, I look to take profits in the first 30–60 minutes — unless the tape keeps confirming. If there’s no follow-through, I scale down or exit. No “wait and hope.”
Bottom line
Sweeps give me a why now. The last 30 minutes give me a when. The 10-minute chart keeps me from forcing it. And the debit spread keeps the risk from getting crazy.
Do it small, do it repeatably, and let urgency + price action do the heavy lifting.
We’re back at it right now with more actionable market insights:
👉 Click here to watch the on-demand replay!
To Better Trading,
Alex Reid
