Change in strike prices close to expiration

#1

I don’t know if this is a nadex glitch or something the market makers are doing but something wierd is happening close to expiration. It’s not from price movement because I saw it on multiple instruments, and just on the closest expiration time. Look at the time to expiration and the change in price.

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#2

Price is impacted by IV, time, price movement, other market makers and other traders.

Market makers make prices on pure automation factoring in all of these factors there is no way to manually manage 1,000’s of contracts and considering nadex is less than 3% of all the contracts of all the markets they make its pure automation. Nothing funny just how options act when they get super close to expiration.

#3

But the prices on the OTM contracts in both directions are going up at the same time.

#4

that would be do to Implied Volatility increasing

#5

This can happen in minutes before expiration. It can happen on news etc…

I will get in straddles and be up on both sides because of implied volatility increasing.

Here is a short article I did on this topic: http://apexinvesting.net/forum/content/138-how-nadex-binary-impacted-implied-volatility.html#.VADKe_l318E

#6

I like that straddle idea. Thanks