In this article, we are going to go into depth with Option Order Flow. You might have heard of dark pool or black box option trading. What in the world is a dark equity transaction and why might investors and traders want access to that information?

After we have uncovered the mysteries behind Option Order Flow, we are going to discuss one of our favorite flow platforms: Cheddar Flow. 

Option Order Flow Overview

Option Order Flow uses software that uncovers large and unusual option trades that are typically being placed by big institutions also known as smart money. This information allows traders to see which stocks and sectors are receiving the most activity, as well as if the activity is bullish bearish, or neutral. 

Platforms such as Cheddar Flow, Unusual Whales, FlowAlgo and more specialize in Option Order Flow data. This type of data is often referred to as dark pool and black box because these are private deals happening in the shadows that retail traders do not have access to unless they purchase access to these platforms. 

Benefits of Option Order Flow

Having access to option order flow data can allow traders to quickly analyze and make a thesis. Institutional investors have a considerable amount of resources available to help them confidently make trades. Watching their trades can give retail traders an idea of patterns and market sentiment, and lead to more educated trade ideas.

Order Flow platforms will display details such as the ticker symbol, sector, premium spent on a contract, type of trade, and more. Watch prints hit the tape, showing large trades taking place in real-time. Many of these robust option order flow platforms will even supply alerts for algorithmic trade ideas. 

Diving Deeper – Cheddar Flow

Cheddar Flow is a leading Option Order Flow platform that specializes in real-time dark pool prints. It has two types of subscription plans, with the Standard Plan starting at $85 per month and the Professional at $99. It may be pricier than some of the other Option Order Flow platforms, but between its easy-to-use interface, the options order flow scanner, and more, it is really quite the deal.

Cheddar Flow: Option Order Flow Scanner

The Option Order Flow scanner is the core of the Cheddar Flow platform. It allows you to watch the prints hitting the tape live, giving information such as if the trade is a sweep, split or a block, expiration dates, strike, price, how much premium was paid, and volume. 

It also has a banner, allowing you to see the overall market sentiment. Is the market bullish, bearish, are more calls or puts being placed, and by how much? This information is laid out for you in an easy-to-read format that allows you to get in-depth with the market. You can even narrow it down to see this information on an individual stock.

Option Order Flow: Unusual Volume

Talking about individual stocks, Cheddar Flow has a module that displays all the stocks that are experiencing unusually high options trading volume for that trading day. The unusual volume table shows the volume amongst other details such as percentage of call and put options, bid and ask price, and the sentiment of the contracts being either bullish, bearish, or neutral.

Cheddar Flow: Premium Filters

Cheddar Flow allows option order flow filter customization. Filter by premium paid, size, expiration date, contract price, delta, sectors, and more. For example, if one wants to make a plays based around earning season, they can set up the filter settings for pre-earnings with premium over $100,000 to get some trading ideas. 

Cheddar Flow: Power Alerts

Cheddar Flow uses AI to offer power alerts. These alerts provide real-time algorithmic trade ideas in multiple signal categories that have proven to have a successful track record in the past. Additionally, customized alerts can be created using the premium filters. 

Summary of Option Order Flow and Cheddar Flow

Using option order flow can give retail traders an edge, allowing access to some of the information institutional traders use to place their trades. Whether a beginner or advanced trader, Cheddar Flow’s easy-to-use platform makes trading opportunities quick to spot and analyze. 

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I may receive affiliate compensation for some of the links included in this article at no cost to you if you decide to purchase a paid plan. This site is not intending to provide financial advice and is for entertainment only.

What is Option Order Flow – Diving into Cheddar Flow

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