Why flow is louder than it used to be
Cboe's third-quarter 2025 review put the full-year pace at more than 13.8 billion contracts, a sixth straight annual record. Single-stock options volume rose 25% year to date. The industry also set record days: 101.9 million contracts on April 4, 2025, and more than 110 million on October 10, 2025 (>Cboe).
That growth matters for anyone scanning for "unusual" trades. When the baseline rises, a scanner lights up more often. Some of those alerts are informed bets. Many are hedges, rolls, spread legs or positions being closed.
What counts as "unusual"
LuxAlgo's guide gives a clean definition: "Unusual options activity is trading that stands out against a defined baseline" (>LuxAlgo). Its example is a contract that trades 5,000 contracts against a normal 1,000. That is five times its baseline.
The same guide is careful about what that tells you. A spike like that is a screening observation. It does not reveal who traded, why they traded or which way the stock will move.
The usual screening inputs are:
- Volume against its own history. Compare the same contract or series over a consistent window.
- Volume against open interest. A trade larger than existing open interest suggests new positions, but LuxAlgo notes it "does not prove all trades created new positions."
- Size in dollars. A large premium outlay gets attention, but size alone says nothing about direction.
- Timing. A burst of activity before earnings or an expiration may simply reflect the calendar.
Five ways a big trade fakes you out
1. It is a hedge. A fund that owns millions of shares may buy puts to protect them. On a flow screen that looks bearish. In the fund's book it is insurance on a long position.
2. It is one leg of a spread. LuxAlgo warns that reading one call leg without its offsetting legs "can reverse your interpretation." A large call purchase paired with a larger call sale is a very different bet from an outright call.
3. It is a closing trade. Volume counts every contract that trades, whether it opens or closes a position. A big print can be someone taking profits on a trade they placed weeks ago.
4. The side label is a guess. Many flow tools tag trades as "at the ask" (bought) or "at the bid" (sold). LuxAlgo points out these labels are inferred from the bid and ask and can be wrong when quotes are stale.
5. The calendar is driving it. Earnings, corporate actions and expirations all create volume that looks unusual and means little about conviction.
Loomi.Ai's own feature description makes the same point in one line: "a large trade alone does not reveal the buyer's full position."
The open interest check
Open interest counts contracts that remain open. It is the best way to separate opening trades from closing ones, but it arrives late. As SpotGamma's help center puts it, "OI is only updated once daily after the market closes" (>SpotGamma).
LuxAlgo lays out the mechanics:
| Who is trading | Effect on open interest |
|---|---|
| Buyer and seller both opening | Open interest rises |
| Buyer and seller both closing | Open interest falls |
| One opening, one closing | No change |
So a practical rule is to wait a day. If a large trade printed today and open interest at that strike rose by a similar amount tomorrow, the position was probably opened and is probably still on. If open interest barely moved, the print may have been a close or a transfer between existing holders.
Even then, LuxAlgo adds a caution worth keeping: "Increasing open interest alongside rising stock prices does not establish bullish conviction on its own."
A reading checklist
| What you see | What it might mean | What to check next |
|---|---|---|
| Large call buy, short-dated, out of the money | Speculative bullish bet, or a leg of a spread | Other legs at the same timestamp; next-day open interest |
| Large put buy on a stock with big holders | Hedge on a long position, or a bearish bet | Whether the stock is near a known event; put size relative to typical activity |
| Volume far above open interest | Likely new positions, not proven | Next-day open interest change at that strike |
| Heavy flow a day before earnings | Event positioning in both directions | Whether calls and puts both lit up |
| Repeat prints in the same strike over several days | Building a position | Whether open interest climbs day after day |
The theme is simple. One print is a lead. Confirmation comes from other data: open interest, price action, positioning and the calendar.
How to use it on the Loomi.Ai Desk
The Loomi.Ai Desk puts flow next to the context you need to question it.
- Options flow scanner. It shows "unusually large or active options trades, including trade size and how the orders reached the market." The Desk is explicit that you should use it "to investigate interest in a stock; a large trade alone does not reveal the buyer's full position."
- Open interest and Greeks in the same view. The Monthly plan lists "Options Flow with OI, Greeks and GEX/DEX," so the open interest check above does not require a second tool.
- Dealer gamma (GEX). Flow tells you what traded. The >GEX Regime page tells you whether dealers are likely dampening moves or amplifying them. A large call buy in a negative gamma regime lands in a different market than the same trade in positive gamma.
- Dark pool prints. The Desk shows reported trading away from public exchanges. Like flow, the size and timing "do not, by themselves, tell you whether to buy or sell."
- Stock-picker algorithms. One of the Desk's five stock-picker lenses is unusual options activity. The others are reported insider buying, momentum, relative strength and a combined score, so you can see whether flow agrees with other evidence.
A simple routine: spot a print in the scanner, check whether it had matching legs, look at the gamma regime for that name, and come back the next day to see whether open interest confirmed it. The whole Desk is $8/mo intro, then $20/mo.
Put the research to work on your Desk
Explore the tools behind the research, compare the available access, or open your Desk if you already have an account.
FAQ
What is unusual options activity? It is options trading that stands out against a normal baseline for that contract, such as volume several times its usual level or larger than its open interest.
Does unusual options activity predict stock moves? Not by itself. A large trade can be a hedge, a spread leg or a closing trade. Treat it as a reason to research a stock, then confirm with open interest and price action.
How do I know if an options trade opened a new position? Check open interest the next day. It updates once daily after the close. If it rose by roughly the size of the trade, the position was likely opened.
Is options flow a buy signal? No. Loomi.Ai presents the flow scanner as a research input. Its own description notes that a large trade does not reveal the buyer's full position.
Loomi.Ai provides educational market research, not financial advice. You are responsible for your own trading decisions.