Anatomy of Crude Pain Trade

"Max pain"  or "pin"  is the strike price at which option holders would suffer maximum financial losses at expiration. A tendency to pin at expiration and how to calculate the 'pin" strike is described elsewhere. Let us consider 2-3 weeks before expiration. The current open interest describes price levels that are significant in terms of money redistribution between the option writers and the option holders. Therefore a strike with a large open interest is expected to show significant resistance. In other words, the current open interest exposes the ladder of future resistance levels.

For example, for the active WTI contract,/CLN19, on 5/29/19 14:37:31 option pin is @60.0. The figure shows other important put strikes (calls better be avoided for now because of the tension with Iran).

Based on the above information,  49.5 Put 20 days to expiration was sold.

Exec Time	Spread	Side	Qty	Pos Effect	Symbol	Exp	Strike	Type	Price	Net Price	Order Type
5/29/2019 14:23	SINGLE	SELL	-1	TO OPEN	/CLN19 1/1000 JUL 19	/LON19	49.5	PUT	0.12	0.12	LMT

2-3 weeks to expiration is necessary to grab enough extrinsic value while more than 3 weeks may be to early for setting the option game. In summary, pin force and theta decay are on my side. It is a paper trade for a test purpose.