This behavior suggests traders are betting on an 'explosive' market move

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This behavior suggests traders are betting on an 'explosive' market move. (via TradingNation)

being bought, deep out-of-the-money puts as well as deep out-of-the-money calls, because they're positioning for an explosive move either way."

Looney, who runs global business development for the firm, calls it a fluid situation as traders and investors evaluate upcoming risks. "There's a lot of what we'd classify as known unknowns. You've got Brexit. You've got Super Tuesday. You've got earnings season coming up," said Looney. He classifies them as "known unknowns" over the next six to eight weeks that have the potential to drive stocks further into record territory or spark a sharp pullback.

"You can take a look at this type of environment and clearly sense that the long bias is afraid though of those big movement potentials," he said. "It'll be interesting to see if we actually get an event that causes a big move how the market allows that positioning to unwind."

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