Lesson 5 of 5 · Dark Pools
Combining with flow
Two data sets, one picture.
Dark pool volume tells you where institutions traded large size in the underlying. Options flow tells you what they paid for directional exposure. When both point at the same ticker and level, the convergence is more meaningful than either alone.
The level dark pools created.
DARK POOL PRINT 1.2M and DARK POOL PRINT 0.9M mark where large size transacted. Those levels are now on the chart. The question is whether the options market is paying attention to the same price.
The flow that followed.
A sweep at the ask, $1.2M premium, volume above prior open interest. This alert targets the same ticker as the dark pool cluster. Two independent data feeds converging on one name is worth tracking.
This one is an animated diagram in the app. See it in Vero.
Convergence is the filter.
A heavy dark pool cluster at $150 and repeated call sweeps on short-dated contracts at the $155 strike are two separate observations. Together they build a more coherent thesis. Neither confirms the other. They raise the probability that close attention is warranted.
Large dark pool volume appears at $72 on a stock. Three days later, $500K in call sweeps hit the same ticker. What is the right response?
Show the answer
C. Add it to your watch list and wait for price to confirm. Convergence raises the case for watching, not for acting. Price behavior at the level closes the argument.