Alpha BreakingPOET Gamma Map: Pinned at $8 While the $10 Bet Grows
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The POET Gamma Map everyone including CNBC is paying attention to
On Friday CNBC mentioned option bets being placed on companies like POET & Wolfspeed $WOLF, as such we mapped Open interest as of Friday's close, October 2. Everything else; Volume, stock quotes and Treasury yields are as of today at noon October 5.
Let’s be real for a second; the stock went nowhere in two weeks, but as we will explain the options board didn't. Since our last POET gamma map on September 21, POET Technologies stock $POET has round-tripped from an $8.65 ECOC-week high to a $7.79 close on Friday, and it's $7.72 on 3.6 million shares as we write Monday. Over that same stretch, the October 16 $10 call line grew from 10,960 contracts to 17,440. That's a 59% build in a strike that sits 30% above spot. Someone keeps reaching for $10. The borrow says it isn't the shorts. The bond market says it isn't the week.
The $8 Pin Into October 16
The October 16 options expiration is the heaviest board on the chain, and the $8 strike is its center of gravity. There are 12,175 calls against 10,476 puts at $8. Call it 22,650 contracts, or about 2.3 million shares of notional, parked on a strike the stock is trading 28 cents under. The put side added about 750 contracts since September 21. The call side barely moved.
Two-sided POET open interest that size tends to act like a magnet as expiry gets close. Dealers hedging both sides lean against moves away from the strike, and the stock gets dragged back toward it. We saw it on August 21, when $POET round-tripped from $9.65 and settled at $8.18, right on the $8 strike. Nothing on this board argues against a repeat. Absent news, $8 is where October 16 wants to close.
Below $8, the $7 line is the next real level: 4,962 calls and 6,374 puts, with 3,481 puts at $6 under that. That's the shelf. Above $8, 7,672 calls at $9 are the first call wall. Between $7 and $9 you have a box. For the ten sessions left before opex, counting today, the base case is the stock trading inside it.
The $10 Call Wall Grew While the Stock Slept
Now the odd part. 17,440 calls sit at the October 16 $10 strike. On September 21 that line was 10,960. The stock didn't earn that build. It closed Friday at $7.79. So the money went in while the price went sideways, and it went in at a strike that needs a 30% move in ten sessions.
Friday's flow in POET options fits the pattern. Before 10:30 AM, TipRanks flagged $POET call volume as above normal and directionally bullish. At the close, a CNBC Closing Bell on-screen graphic read "Bullish flow in smaller chip names Wolfspeed & Poet." A small-cap AI photonics stock doesn't make that screen often. We didn't need the graphic, though. The board already said it.
What open interest can't tell you is who's on which side, and that matters here. If the $10s are mostly covered calls written by longs, dealers are long those calls and sell stock into rallies. That's a wall. If the $10s were bought outright, dealers are short them and have to buy stock as the price climbs. That's fuel. Same strike, opposite physics. Two bullish flow reads in one session tilt us toward buyers, which makes $9 the line to watch. Clear $9 on volume and the hedging flips. Fail there, and 52,000-plus calls from $8 through $12 go to zero on the 16th.
Monday's Flow: One Print Matters
Through late morning, POET options are quiet except for one line. 6,860 puts traded at the October 9 $7.50 strike against open interest of 776. That's nearly nine times the OI, so it's an opening position, not a close. Next to it, 2,280 calls traded at the October 9 $8 strike against 2,437 open. Everything else is retail-sized: 418 calls at the October 16 $8, 288 at the $10, 207 at the $9, and a few hundred November calls we'll get to below.
We can't see the side on the $7.50 puts, and the side is the whole story. If a long bought them for protection into Friday, dealers are short those puts and will sell stock faster if $7.50 breaks. That turns $7.50 from a level into a trapdoor. If someone sold them to collect premium and get paid to own stock at $7.50, dealers are long the puts and buy into weakness near the strike. That's a floor. Tuesday morning's open interest print tells us whether it's one block or several, and the tape around $7.50 tells us the rest. Either way, $7.50 is this Friday's line, and the October 9 board went from three calls per put in open interest to two puts per call in volume in one morning.
October 16 Is the Cleanup Date
That's the number worth sitting with. From $8 up through $12, the October 16 board holds 52,333 calls. September's triple witching cleared more than 31,000 stranded $8-and-up calls, and we called it a cleanup. This one is bigger. If the stock is under $8 at the bell on the 16th, every one of those contracts expires worthless, the dealer hedges behind them unwind, and the board resets. That isn't bearish by itself. A cleared board is the setup that let the stock gap through $8 on the Monday after September's witching. Less overhead, less friction.
The two weeklies on either side are thin. This Friday, October 9, holds 2,437 calls at $8, 1,930 at $8.50 and 2,231 at $9, against 1,057 puts at $7 and the 776 at $7.50 that just got company. October 23 has one line of size and that's it: 4,386 calls at $8.50 against seven puts. That reads as one position, not a crowd. Treat it as a marker, not a wall.
Before you get excited realize the borrow Says This Isn't a Squeeze Setup…
The $10 crowd should read this twice. Per Ortex's October 2 note, POET short interest is holding around 17%, but cost to borrow dropped 38% on the week to 0.44% and availability jumped to 89.5%. Shorts aren't pressed. Nobody is paying up to stay short. A gamma squeeze needs two engines: dealers forced to buy as calls go in the money, and shorts forced to cover. The first engine is loaded. The second is idle. So a move through $9 would run on dealer hedging alone, and dealer hedging alone fades once the chase is over. That's the difference between a squeeze and a spike.
The Bond Market Is Driving, Not the Board
Most of what moved $POET since our last map didn't come from the chain. Treasury yields did the work. On September 21 the 10-year was under 5%. It jumped 16 basis points on September 23, touched 5.34% on October 1, the highest since 2002, and fell to 5.15% in the minute after Friday's jobs miss before climbing right back. Monday morning it's 5.30%, the 30-year is 5.66%, and the 2-year is 4.82%, with FedWatch putting an 82% chance on a hold at the October 28 meeting. That mix tells you the problem isn't the Fed. The front end already calmed down. The long end didn't, and the long end is what prices a company whose cash flows live years out. When 30-year paper sells off, pre-profit small caps get sold first and asked questions later. POET's $796 million in cash earns more at these rates. Its multiple doesn't.
So the levels that calm this stock down aren't on the options chain. On the 10-year, 5.15% is the first calm line; a close under it says Friday's relief held. 5.00% is the all-clear, which is where it sat the day we published the last map. 5.34% is the spike high; a close above it breaks the $7 to $9 box lower no matter what the dealers are hedging. On the 30-year, 5.57% was Friday's low and 5.69% was Thursday's high. Same logic, same direction.
The calendar inside the pin window is all bonds. Fed minutes Wednesday at 2 PM. The bond market is closed Monday the 12th while stocks trade, which makes for a thin tape. September CPI lands Wednesday the 14th at 8:30 AM, two days before opex, with PPI and retail sales Thursday the 15th. If CPI prints cool, the $8 pin gets easier and the $9 test gets a bid. If it prints hot and the 10-year takes out 5.34%, the $7 shelf gets tested with 52,000 calls stranded above it. We wrote about what a hike cycle does to AI names. The short version: it hits the longest-duration stories hardest, and $POET is one of those.
Positioning Into the Q3 Print
E*TRADE's calendar has POET Q3 earnings on November 12. POET hasn't confirmed it, and last year's print came November 13 after the close, so treat it as a window, not a date. Either way, the November 20 monthly is the first expiry with real size after the print, and it's built differently from October. Between $8 and $16 there are 41,279 calls. From $8 down to $3 there are 11,205 puts. Nearly four to one. The top line is 9,413 calls at $10, then 7,420 at $8, 6,111 at $11, and a 4,195-contract stack way out at $15. The puts that exist are mostly tail hedges: 3,789 at $4 and 563 at $3.
Monday's November flow is more grounded than the standing stack. 444 calls traded at $9, 312 at $8, 190 at $7, 122 at $10 and 105 at $11, against about 140 puts total. Nine calls for every put, and most of them within a dollar of spot. That's a crowd positioning for a good print, not a moonshot.
Three things about that setup. First, the October $10s expire almost four weeks before the print. Paying for a 30% move with no scheduled catalyst inside the window is a donation unless news lands early. The same bet in November at least gets to see the number. Second, the bond calendar front-runs the print: FOMC on October 28, October jobs on November 6, October CPI on November 10, two days before the E*TRADE date. The stock walks into earnings carrying whatever the long end does that week. Third, there's a November 13 weekly on the chain with almost nothing in it yet. If the print lands November 12 after the close, that weekly expires on reaction day. Watch it fill in. The strikes that load there will tell you what the market thinks the move is, better than any analyst note.
How We're Reading It
Ten sessions to opex, and the POET options board says box. Base case: $7 to $9 with $8 as the magnet and a close near $8 on the 16th. This week's line is $7.50, courtesy of one 6,860-lot. Upside trigger: a $9 break on real volume, which flips the $10 line from wall to fuel, and it probably needs Treasury yields to help, meaning the 10-year under 5.15%. Downside: a $7 break puts the 3,481 puts at $6 in play, and the board has nothing between $6 and $7. No gamma squeeze without the borrow engine, either. After the 16th the POET gamma map is November's, and November is an earnings bet with a bond market in front of it. Open interest shows you where the hedging lives, not where the stock goes. Right now the stock goes where the 30-year tells it.