Hidden wave, also known as implied volatility, can be compared to "PE (price-earnings ratio)" of options.

In fact, there is no P/E ratio for options. This metaphor is just to show that implied volatility is an indicator of whether the option price is overvalued (just like the price-earnings ratio is for stocks).

The implied volatility is higher than the actual volatility, which means that the price of the option contract is overvalued.