So I was trading the option contracts on NLY (Annaly Capital Managment) today. The stock took a big dip today which piqued my interests in selling some OTM puts. Since the options market on this particular stock is not a very liquid you have very wide bid-ask spread making it tough if you want to get your order filled.
When I put in my limit to sell the, quote on the October 11 strike weekly's with 28 DTE, were .06x.10, with both the bid and offer 350 contracts deep. I put my limit on .09 to make it more competitive, put me at a 19 vol. The market traded for a while without fill and as time passed, I started seeing more limits dribbling down towards my .09 price, albeit the biggest blocks were still at .10, so a penny above me. To play it a little more conservatively, I decided to move my limit a penny up in case the market dropped some more. I want to note, that the limit orders to sell were firm at 10 cents all day as I watched the time and sales.
ALL IN BEHOLE at the EXACT same instant I lifted my offer... all the limit orders to sell at my .09 price, were all pulled out and moved to .1 as well . It couldn't have been some human trader. Was there some algo shadowing my order?