Option Sentiment Score (OSS)

OSS is a quantitative tool that analyzes option chain data to gauge short-term market direction for key assets such as SPY, QQQ, IWM, and GLD. The OSS model examines the distribution of open interest and its change, option price movement, implied volatility shifts, and key option Greeks like delta and theta. It focuses on weekly options nearing expiry, where positioning is most telling.

It produces a score on a 0 to 100 scale, where a higher score indicates a more bullish sentiment and a lower score reflects bearishness.

MoneyFlow Table :-

For example:

1. Selling Cash-Secured Put Options

OSS helps pinpoint the optimal strike price, expiry, and entry timing to sell puts with a high premium, low risk of assignment, and strong probability of profit.

2. Selling Covered Calls After Assignment

If shares are assigned from previous put sales, OSS guides the ideal timing and strike price for covered call sales to generate consistent income and manage downside exposure.

3. Taking Bold Positions When OSS Hits Extremes

When OSS is at either extreme — below 20 (strongly bearish) or above 80 (strongly bullish) — we aim to “make hay while the sun is shining.”

These are windows for high-risk, high-reward trades, where we may buy or sell leveraged ETFs like UPRO, TQQQ, or TNA, depending on the direction. Although riskier, these positions can deliver outsized returns during sharp market moves.

OSS offers a structured, data-driven edge for traders looking to capitalize on short-term momentum while managing risk.