Making Coin Off 'Maximum Pain'

Today I want to do something a little different from normal. For my last couple of weeks here on Real Money Pro, my objective is to introduce a few concepts that I have not covered previously, as well as to introduce some good trading ideas -- such as Tuesday's Apple (AAPL) and SPDR Energy Select Sector (XLE) trades.

I have a trading friend and colleague, Jason Leavitt, who -- on the third Sunday of each month -- takes a look at open interest on the near-month SPDR S&P 500 (SPY) and its counterpart, the PowerShares QQQ (QQQ),  in an attempt to identify the maximum pain point. I'm sure you have heard that term -- it refers to the price point at which the most options expire worthless. He does this as kind of a predictor of how the market may behave for the remainder of the week, using the level where maximum pain is centered. This week the analysis called for a huge rally. We saw that Tuesday. Uncanny!...382 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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