The hypothesis that I am mulling over (and more so, its effect on stock price movement) is the following.
Hypothesis: Buyers of options do not hedge (as they don't need to) while sellers usually hedge in some form or the other.
If that is true, what happens is that if buyers of stock keep buying, and spot price moves closer to a strike price, then the call sellers will buy more of the stocks to stay hedged based on the delta value of that particular call option. The put option sellers will reduce their short position as the stock price goes up as they do not need to short that many stocks when the spot price goes up. This creates additional buy pressure on the stock as if it got accelerated momentarily, which would have not existed had there been zero options open interest. In a similar way, the movement of the spot price gets accelerated when the spot starts to head downwards towards a strike price.
So in effect, these derivatives (I think futures has the same influence on the spot price) cause acceleration of the spot price in the direction of its movement as and when it moves closer to the strike levels. This will be more pronounced if the open interest is high around that strike price (and perhaps their neighbors too). I'd also wager that closer the option is to the expiry, the more is the acceleration near the strike prices as gamma is ultimately what dictates the rate at which the seller hedges.
Is my thought process above completely bullshit? Is any of it right? If there are (easy to understand) sources to learn more about these effects (assuming there is some truth to it), I'd appreciate it if you can share them with me.