I have seen the insides of an options market maker, and can say this is not really true (at least for some regions of the market). Black-Scholes is used to derive theoretical prices for options. Good option traders will have an opinion on volatility and won't just take whatever the market says.
However, one of the interesting aspects of serious option trading is that Black-Scholes is merely your bread and butter. There is a lot of information that goes into option pricing, including supply/demand signals. The mix of signals also depends on the time scale on which you are trading.
What rings true to me with this comment is the correlation between products. Option traders are often concerned with many relationships between product pricing: between underlying and option, across expiries, across strikes, between products in indices, between products in sectors, etc .
However, one of the interesting aspects of serious option trading is that Black-Scholes is merely your bread and butter. There is a lot of information that goes into option pricing, including supply/demand signals. The mix of signals also depends on the time scale on which you are trading.
What rings true to me with this comment is the correlation between products. Option traders are often concerned with many relationships between product pricing: between underlying and option, across expiries, across strikes, between products in indices, between products in sectors, etc .