How to read option contracts, chain explorers, and understand Unusual Whales tools

As part of our free weekly educational series

Hey all,

This is the Unusual Whales Team, and we are going to spend every Wednesday/Thursday walking you through some trades of the week for free to help your trading!

In today’s issue, we’re going to cover the Unusual Whales Chain Explorer and Contract Lookup features. We’ll break down the pages, what information you can find there, and how to use them!

We often discuss the importance of the relationship between Volume and Open Interest. The way we confirm opening trades on a day with high volume is the carry over IN to open interest, for example. Did 1,000 contracts transact, followed by 500 more? Is that all new positioning? Or did they close half of their position? We confirm questions like this  the following morning by checking to see if all of that volume remains open and carries over into open interest. The best way to keep track of changes in OI is with the Open Interest Explorer.

The Open Interest Explorer is divided into two sections; the Chain OI Changes, and the Ticker OI changes. 

The Chain Open interest change tracks individual contract chains across the entire market. You can organize your feed any way you’d like; If you want to see which chains had the highest percentage change in Open Interest, just click the column; this can be organized by both ascending and descending order. You can have the highest positive gain on top to show which chains had the most volume carry over from the prior day. Or, if you’d like to see which chains had the most position closures, you can switch it to have the most negative changes up top. The same goes for the other columns.

Any chains you visit will also be documented in the Contract Lookup page. On the Contract Lookup page, you can navigate to the highest options chains and tickers by open interest. You can view the full contract breakdown and historical data on this page, and it automatically keeps track of contracts you’ve looked up previously. 

There are a number of filters you can use to fine-tune which chains display in your feed, so we’ll cover the main ones here.

Just like the Flow Feed filters, you can narrow your search by individual tickers (several, if separated by a common), limit the feed to calls or puts (or both), and select which equity types you’d like in your feed.

You can also fine-tune the previous chain activity by choosing what % of the OI built at the ask or bid, or the skew one way or the other. You can also hone in on the previous and current OI values, how much the OI changed both in value and in percentage overall (this filter is set to 1, meaning a 100% change in OI or more). The filter above also shows a 0.05 %OTM, meaning this filter will only catch contracts that are 5% out of the money, or more. So if a stock traded at $100, this will only display chains for that stock from the $95 strike or lower for puts, and the $105 strike or higher for calls.

This feed will display the Daily OI Change, as displayed above, (from “yesterday” to “today”), but you can change it to display the Historical OI Change, as well. This will allow you to see the Open Interest changes over time, rather than just the one day change. You can select from 3, 5, 7, and 10 Days on the Historical view.

Within the Contract Lookup, you can search for tickers and view the Chains with the highest volume. You can do so with any ticker you’d like; in the example below we’ve used Apple, $AAPL. The example is currently set to sort by Volume, but you can sort the feed by any column you’d like; it just depends on what you’re looking for. 

You can also filter out Calls or Puts, and fine tune the feed to display only contracts whose OI has increased, whose Volume is greater than Open Interest, whether you want out of the money only contracts to display, and more with the Filters, pictured below.

In the top line of the tool, you can search for specific contracts to open in the Contract Look-up. Here, we’ll look for the $AAPL $170 Call Contract expiring on April 12, 2024. Once you’ve entered in the contract you want to view, clicking the Plus sign will open the contract in the Contract Lookup screen to display the historical data for that contract in the same Contract Summary layout you get by clicking the expiration date hotlink from the Flow Feed. It will also be added to your Recently Viewed Tab.

The other view for this page is the Ticker OI Changes view.

This view is the same as the Chain OI Change view, except it encompasses the data from every single options chain for every stock ticker. In this image, the feed is raw (no filters), and sorted by OI Change in Percent. You can see here that $RM had the highest change in open interest by percentage (387%), but it’s worth noting that the ticker only had 45 previous Open Interest. So a change from 45 to 219, a change of only 174 contracts, is a lot less impressive than the 387% increase would have you believe. 

The $APGE has a bit more of a change. The Previous OI was 334, and is now 1,336. That 300% increase is a bit more worth looking at than the $RM change.

Always use context when looking through options data!

The filters section of the Ticker OI Change is a bit less expansive, but still allows you to narrow your feed down by the percentage change in open interest (and raw change), Market Cap, and Sector.

Thank you as always for reading! I hope this article helps you understand the OI Change and Contract Lookup tools! Be on the lookout for more guides, walkthroughs, and Education on the Unusual Whales YouTube channel!

NOTE: This post is not financial advice. The stock market is risky, and any trade or investment is expected to have some, or total, loss. Please do research before any trade. Do not use this information for investment decisions. Check terms on site for full terms. Agree to terms before considering this information.