Exclusive: Options Expert Sees Market Creeping Higher

Nic Chahine was recently a guest on #PreMarket Prep, a daily trading idea radio show hosted by Joel Elconin and Dennis Dick. Tune in to the daily broadcast live Monday-Friday at 8 a.m. ET here.

On Benzinga's #PreMarket Prep, options expert Nic Chahine said that he expects the SPDR S&P 500 ETF Trust SPY to "creep up," not "crash up." With that in mind, he is shorting what he calls "relief pops." As Chahine describes, the relief pop happens when the market gains based off of the idea that "something bad didn't happen."

For example, Chahine said that yesterday, the market gained on "expectations of a rumor, not even a rumor." That provided the opportunity for Chahine to sell premium above the market.

Chahine said that he was mostly trading on sentiment at the moment, using major news headlines and price action to dictate trades. He argued that there is "no conviction [at the moment] in the long thesis." Instead, bulls are in and out of the market, hitting the sell and then buying it back at lower prices. As for the bears, Chahine said they "aren't even on the field."

Finally, Chahine cautioned against using the current weekly options contract to trade, noting that if one of these relief pops happens on a Friday, a trader could find himself in a bad position. Instead, Chahine uses weekly contracts, but in other weeks.