 Hello everyone, welcome to Options with Doug, streaming live daily on Bookmap Discord and the Bookmap YouTube channel at 1.30pm Eastern Time. Before I get started, I need to go through the general disclosure. All Bookmap limited materials, information, and presentations are for educational purposes only and should not be considered specific, investment advice, nor recommendations. Risk disclosure. Trading futures, equities, and options involve substantial risk of loss and is not suitable for all investors. Pass performance is not necessarily indicative of future results. On my apologies again today, more technical issues. My computer decided to restart again while I was out at lunch. So I came back about 1.15pm, 1.20pm and my computer had restarted so I lost everything so I had to get Bookmap set up again and everything else. So again, my apologies. You can guess what I'm going to be doing this weekend is troubleshooting this computer. I'm not sure what the problem is. Anyway again, my apologies. I'm starting about 10 minutes late so I will go. So I've got about 1.40pm now and I'll go to about 2.40pm. So again, my apologies. Let's get started. My contact information. Here it is. The best way to get in touch with me is on Discord. My name is Doug P. Also on Bookmap Discord. Here's the Options-Doug Chat channel. That's a great place to post questions, comments and content related to the topics of this presentation in my channel and the Options-Doug Chat channel that I'll go over in just a moment. So Bookmap Discord is free and open to everyone and you're all welcome there. I'm also on Twitter, actually formerly known as Twitter X now at Doug Pless is my name. The focus of my presentation and the focus of the Options-Doug Chat channel is Options Order Flow, the impact of options markets on stocks and futures, and the influence of market maker hedging flow on price action. I have a two-step process for trading and the first is planning and I use positional analysis. I look at how traders and market makers are positioned at the options market and how those positions change from day to day to develop a thesis regarding the expected trading range and volatility for the day as well as the directional bias. And the second step in my process is execution and I look at real-time order flow on Bookmap and real-time market maker hedging flow on SpotGamma Hero to confirm my thesis and for setups for entries and exits. And when I talk about setups today, I will be talking about setups in an underlying asset and setups can be taken any number of ways with futures, shares of stock or options for example a setup in the ES500 can be taken with ES futures, spy shares, spy options, SPX options or even ES options. Questions and comments are welcome and I will be watching both the Options-Doug Chat channel and Discord as well as the chat and YouTube for your questions and comments. And again, thank you for your understanding everyone, Gray, Joel, Don, thank you very much. All right, my agenda for today, what I want to cover is first of all news items, economic data and events for today, then I'll go through my positional analysis, then I'll review some setups from this morning and then I'll talk about the live market. And when I get to the live market, if anyone has any stocks they want me to take a look at, please let me know and I'll be glad to do that. All right, let's get started with economic data and events for today. So first of all, the big event, economic data event was the core PCE data that came out there and a number of different versions of PCE, but it looked like to me it was all pretty much in line to maybe slightly lower than expected. So there's the PCE data and then of course today is the end of the quarter, end of the month and kind of a minor options expiration. This chart is showing delta notional on the vertical axis with expiration date on the horizontal axis and this is for a combined SPX by NDX QQQ and Russell 2000. So what this is showing is there's the expiration today slightly put dominated, that's shown by the larger blue bar where there is more put or negative delta expiring than positive and that can potentially help fuel a rally, so potential for a slightly negative or put fueled rally as these puts expire and actually there was one other new item today, consumer sentiment came out at 10 AM Eastern time and that was greater than expected, also greater than the previous number. All right, so that is the PCE data, consumer sentiment and the slightly put dominated expiration today. All right, let's get started with positional analysis now, I'm going to start with ESP500, so this is the ES futures in book map and note that because of my restart, I did lose my, excuse me, lose my MBO data, that's the stops and icebergs, so that will limit my ability to analyze the market a bit. All right, so this is the ESP500, before I take a closer look at this chart, I'm going to take a look at a larger time frame, I'm going to go to the SPX, this is a 30-day one-hour chart for SPX, here's the September 15th, very large expiration call dominated and the downtrend began then as calls expired and market makers could sell their hedges and it appeared that that rally may have, that downtrend may have stopped on Wednesday but now price is moving lower again, so maybe that was just a pullback, we'll have to wait and see on that. All right, let's take a look at some levels on this chart, so first of all, the dashed purple lines are showing the lower and upper weekly expected move and that is based on the options market, that should be available in any trading platform that has an options chain and that is updated once a week and that's for the week. Then the dashed blue lines are showing the lower and upper daily expected move, again based on the options chain, options pricing and risk and that changes every day. All right, so the SPX is trading within both ranges, the daily expected move as well as the weekly expected move. All right, let me point out some spot gamma levels on this chart, these are proprietary spot gamma levels based on gamma weighted open interest, these are available to spot gamma subscribers, first of all I'm going to go over the key daily levels, so here is the put wall that's at 4200, that's the strike with the largest net negative gamma that can be expected to act as support, then above that the 4300 level is the absolute gamma strike, that's the strike with the largest absolute positive and negative gamma, then above that is the volatility trigger, that is spot gammas, let me redraw that, put wall absolute gamma strike volatility trigger at 4350, that is spot gammas proprietary gamma flip level, below that level market makers position on the gamma curve is negative, in a negative gamma environment market makers have to trade with price to hedge their delta exposure and that tends to enhance or increase volatility, on the other hand above that level market makers position on the gamma curve is positive, in a positive gamma environment market makers have to trade against price to hedge their delta exposure and that tends to subdue or decrease volatility and notice that SPX is trading below that level, the gamma notional at the beginning of the day was negative and is still negative, then finally the call wall is at 4500, that's the strike with the largest net positive gamma that can be expected to act as resistance and as far as shifts in levels for SPX there was only a minor shift lower in the volatility trigger from 4360 to 4350, so otherwise the primary levels, the put wall, call wall and absolute gamma strike all held steady. Alright, let's take a look at SPX for today to see what levels, take a closer look and see if there are any levels in play for today, so really the only level here shown on this chart is the 4300 absolute gamma strike that's showing that as an L3 level also a combo L2 level, let's just zoom a little bit so we can see anything else in play, so again SPX trading within the expected daily range but heading toward down toward the lower daily expected move. Alright, let's take a look at bookbap now and I should zoom in on this chart, sorry all my charts were reset, I didn't have time to reset every chart, alright so this is bookmap, I have my own cloud notes here and I am showing SPX levels, note there is a difference in price between SPX and ES and right now it's a little bit less than 37 and I use 37, so I'm showing SPX 4300 absolute gamma strike at 43.37 ES, so again 37 point difference, I also have the support and resistance levels that were noted in the SPOT gamma AM founders note, they're not shown on the thinkorswim charts but I do show them on my charts, then finally I have SPI levels and they are two lines right here, the label for the 43.15 support level that should, that is meant to line up with the SPI 430 level and SPI 430 is the absolute gamma strike and also the volatility trigger, so this is a very important level for SPI, so that's essentially SPI 430 right there at that level, so I've got SPX levels, SPI levels and then also big ground numbers for the ES, the zeros and the fifties, alright so in the morning session the, initially there was support right around the 430 level, price chopped around the 431 level and then started to move lower around 1130 and we'll take a look and see what options traders were doing, price broke below the 430 level and now is heading down toward the 42.74 level so yesterday for the SB500 there was a very clean, the reactions at the SPI round number levels, very clean, I posted a setup with the reversal at the SPI 425 put wall and a move up to the 430 level, not so clean today for the SB500, alright so those are the levels of play for today, as far as shifts and levels for SPI, there was one shift, the call wall shifted higher from 450 yesterday to 450 to 460 today, so that is well out of play and not really in consideration today, alright so that's the SB500, again we'll take a look at setups in a few minutes, let's take a look at NASDAQ and before I take a closer look at this chart that's in QQ Futures, I'm going to first of all isolate the QQQ levels in play for today, so here's the QQQ volatility trigger, QQQ initially traded above that level then it enacted edge resistance, QQQ making a series of lower highs, a test of the volatility trigger at 362, then VWAP, then the trend line and then a sharp drop lower after that, let me zoom in on this a little bit, alright let's take a look at NDX now, let's actually go back to QQQ, so looking at gamma levels again the volatility trigger, this combo L5 level did act as support until price broke below, then broke below the 360 level which is the absolute gamma strike and that strike did move higher from yesterday from 350 to 360, let's take a look at NDX and we'll see this combo level in play as well that acted as support so just for completeness we'll take a look at NDX, so there's that combo level, the combo level for NASDAQ combines NDX and QQQ into one again one gamma level, combo level, alright let's go to book mount, so for NQ I have my cloud notes again and I have so there's the zero gamma level, NDX levels also QQQ levels, there's the 360 absolute gamma strike, notice that NASDAQ traded up to its upper daily expected move today and then reverse lower, alright so those are the NASDAQ, the levels in play for today, again we'll take a look at setups in a few minutes and shifts in levels, again the absolute gamma strike for QQQ shifted higher and the volatility trigger for NDX shifted slightly higher and Devano says show us BTC, Bitcoin, sorry I don't have any crypto here, yeah I don't trade crypto, I really don't know anything about it, I primarily trade futures and stocks and that are pretty heavily driven by the options market, alright let's take a look at Gamma Notional now to see how market makers were positioned on the gamma curve at the beginning of the day, so here's Gamma Notional for SPX, SPY and QQQ, Gamma Notional for NDX is not significant, notice all these numbers are negative SPX 1.25 billion, SPY 2.2 billion and QQQ 764 million all negative, this indicates that traders are long puts, market makers are short puts and they have to trade with price to hedge their delta exposure, so if price decreases their delta notional will increase and they have to sell futures, they want to remain delta neutral and those numbers did become slightly less negative than yesterday but still quite negative, alright let's take a look at the Vana model now and this will give us a graphical representation of what I was just talking about, this is SPX, this chart is showing market makers delta notional and how that changes with changes in price, delta notional shown on the vertical axis, price shown on the horizontal axis, there are two curves on this chart, the light curve is showing how market makers delta notional changes with changes in price only, the purple curve adds implied volatility to the equation, that showing how market makers delta notional changes with changes in price and implied volatility and that change in delta with a change in implied volatility is the Vana effect, Vana is a second order Greek, so what this chart is showing is if price increases market makers can buy back short futures, their delta notional is decreasing, they always would remain delta neutral, so Frank this would be a put Vana rally with a movement this way price increases, implied volatility drops, market makers can buy back short futures, alright so when I check this morning, let's see, let's go back to the SPX chart, so the high of the day for SPX was about 43.32, alright somewhere around here, so this is indicating at that high of the day very little potential for a put Vana rally, this is showing as price increases and implied volatility decreases, market makers could buy back short futures but this is compared to the last few days not very significant, so not much of a potential for a put Vana rally, so today again we were looking for first of all some loss of puts due to the expiration today and that could potentially provide fuel for a rally as well as put Vana, but at the high of the day at 43.32 that fuel was pretty limited and actually that's right around here, so I drew my arrows a little bit too far to the left, somewhere between these two lines, alright so very little potential for put Vana rally and again remember the expiration compared to especially the October and December expirations that were shown on that chart was not very significant, now on the other hand if price decreases and implied volatility increases, market makers have to sell futures and this is typical of a negative gamma environment, so it works both ways, so if price decreases and implied volatility increases market makers delta notional will increase and they have to sell futures to hedge their delta exposure, so there was a potential for a put Vana rally and so far that does not seem to be the case today, let's just go back and take a look at SPX chart one more time so SPX continues to move lower, right now trading right around 42.80, so if price does rally from here there's more potential for a put Vana rally, so if implied volatility starts to drop price increases now there's more potential fuel for a put Vana rally, on the other hand if price keeps moving lower market makers will have to continue to sell futures to hedge their delta exposure, alright let's take a look at SPI and QQQ, alright Frank I hope that answers your question, so it's something that I was looking for but so far working the other way, again remember that Vana model works both ways, so right now SPI is trading around 4.26, somewhere between 4.26 and 4.27 so SPI is here and if price rallies there's more potential for a put Vana rally, on the other hand if price continues to drop, implied volatility increases market makers will have to continue to sell futures, this always works both ways, take a look at QQQ and by the way these curves with a very steep skew upward into the left these are typical of a negative gamma environment, this type of curve in the Vana model, QQQ trading around 3.57 so that's right around here so some potential for a put Vana rally as well and then again on the other hand if price continues to drop market makers will have to continue to sell futures, let's just take a look and see what VIX is doing, use this as a proxy for implied volatility, so so far VIX is making a series of higher lows all day and continues higher, right so price dropping implied volatility increasing and so far not looking for a put Vana rally, alright let's take a look at some setups now and I'm going to start with this hero signal for the S&P 500 this is the hero signal again from spot gamma available to spot gamma subscribers hero stands for hedging impact real time options HIRO, this chart is showing first of all price for SPX that's with the white line, the purple line is the hero signal that's hedging impact real time options and this is for a combined signal so this is showing options trades and market maker hedging activity for a combined signal for SPX, SPY, XSP and ES futures, alright instead of initially zooming in on this chart I'm going to take a look at the SPY chart which is one component of this chart and the reason I'm doing that is because of these alerts so I'm going to zoom in on the morning session and this may be difficult to see these icons are pretty small but there's a small yellow dot that says flow here and that there were a number of flow alerts this one what's the best the first one right after 10 a.m. and there's no indication whether this means bullish or bearish Brent's founder of spot gamma talked about that earlier this week in a presentation to subscribers I think one of his main uses of this is to look for mean reversion and that's definitely how this signal worked so on the SPY chart just after 10 a.m. there's a flow alert and right about the same time he will turns lower and price turns lower so let's go take a look at book map now we'll go back to the S&P 500 zoom in on the morning so here's that where that alert came in 10 a.m. note the shift in order flow aggressive buyers shown by the green volume dot those are marked by minus cell delta so a green dot indicates more buyers than sellers magenta dots indicate more sellers than buyers let me just darken up the heat map a little bit there was some liquidity resting at the 4370 level so price reverses as traders start taking negative delta positions note the start the sharp shift and cumulative volume delta that's shown by the dark blue line in the sub chart and again unfortunately I lost all my MBO data that's market buy order data that's what spot gamma uses I mean book map uses for the stock stocks and icebergs so there's the short set up this morning and let's zoom out and a wide book map is not recentering we tone down the heat map more so SP500 was making a series of lower highs and then finally broke below this 430 level shown right there consolidated and continues to move lower now dropping more sharp sharply trading making a series of lower highs again all right you're welcome Frank so Frank ask are there so many puts expiring today so the Vanna was neutral this morning so the Vanna showed at the high of the day a slightly you know slight move up on that gamma curve toward the left so it's potential for a slight Vanna tail one remember that that chart works both ways so if at that starting point if market makers if price continued to move higher market makers could buy back short futures slightly did you know there was a slight Vanna tail wind shown by that chart again on the other hand this works both ways so if we just saw that VIX was increasing price dropping so implied volatility is increasing think of that purple curve applied volatility increasing and price decreasing market makers have to sell futures to hedge their delta exposure and yes there are puts expiring today but this is compared to again October and let's just take a look at that compared to October in December fairly minor so this is this is today this is October and this is December all right so that was the really the best starting point for a short this morning that first flow of art on spy and let's just go to the combined signal now here for the SAP 500 so this is combining SPX, SPY, NDX, I mean SPX, SPY, XSP, and ES futures so here's that signal for SPY and this is price initially moves lower then right around 10-20 options traders for the combined signal start taking positive delta positions price responds a little bit higher but just makes a lower high let's zoom out for the day so it looks like let me get to where I'm showing the entire day from the from the cash open so this is the 930 regular trading hours traders were taking positive delta positions really up until about 1130, 1120 that activity levels off and now they've started taking negative delta positions as price continues lower so they're finally joining the party about 1245 let's take a closer look and see what they're doing so today they are buying calls buying puts that's pretty typical buying calls shown by the rising orange line positive notional value they're also buying puts shown by the negative notional value there they call buyers started to take their foot off the gas or around 1120 or so still buying calls and then finally that activity has now starting to cool off even more and then traders were initially it looks like they were selling puts shown by the rising blue line and then right around 1245 started buying puts all right so that's the SB 500 today a little bit of a difficult read today let's take a look at NASDAQ all right so PAS 2910 what about 0 DTE okay we can take a look at that so I'm going to go to next expiry so for the SB 500 this would be options that expire today and the green line here or teal line that's showing the 0 DTE trades so it looks like they are a little bit more taking more negative delta positions than the traders in the all expirations which would be this is the all trades all expirations so this is the 0 DTE with the green line purple line showing all expirations so net for the day they are they've started it looks like they were buying let's just zoom in a little bit so up until about 1245 net for the day they were buying with 0 DTE and all expirations and the 0 DTE was a bit less than half of the total notion of value up to that point then both shifted lower all right let's take a look at NASDAQ so first I'm going to take a look at QQQ that's where these alerts appear so here's an alert at 940 right at the hedge wall the 361 so again this QQQ alerted at the 361 hedge wall and initially QQQ moves higher almost to the 363 level and really the key was just watching hero itself making a series of lower highs so this set up a hero divergent short right around 10 just the same right around the same time as the S&B 500 so let's go to NASDAQ let's zoom in on this sorry give me just a moment to adjust the chart so we can see this a little better right so here's the QQQ 361 level the bounce all the off that level when that alert comes in and then the reversal at just below the 363 level right around the NQ 15,050 level and the NQ upper daily expected move pretty clear shift in order flow aggressive buyers moving price up they're exhausted or the buyers exhaust and then sellers come in that's shown by the shift from the green volume dots to the magenta volume dots and price moves lower as that hero divergent signal signaled that traders were taking negative delta positions all right let's go back to hero now right so again this is for QQQ and so to sorry says met a trend down today from 310 310 is the call wall that is definitely something that I want to take a look at all right since then in QQQ traders have been taking positive delta positions and price not responding let's take a look at the combined signal for NASDAQ this is combining NDX and QQQ similar story as QQQ which is the major component of that let's take a look and see they are buying calls and buying puts call buyers more aggressive shown by the rising orange line the positive notional value all right so after that initial divergence hero it looks like options traders are not not really driving price let's go back to book map all right so maybe NASDAQ is finding support at the 14665 NDX zero gamma level all right let's take a look at some stocks so we'll take a look at Meta this those are I just mentioned let's go take a look at hero Meta so met on this note that Meta 310 is the call wall that acted as resistance to separate outputs and calls so initially call buyers were driving Meta higher up to the call wall they took their foot off the gas and price reverse lower then the put buyers took over and price continues to trade lower down now to the 300 key gamma strike so a couple of key gamma levels and play call wall at 310 acting as resistance and maybe the 300 key gamma strike will act as support so call buyers driving price from the open up into about 10 a.m. they take their foot off the gas they stop buying calls and price starts to drop lower then put buyers come in right around 1050 so when traders buy calls market makers sell the calls and they have to buy stock to hedge their delta exposure on the other hand when traders buy puts market makers sell the puts and they have to sell future sell stock to hedge their delta exposure all right let's go back and take a look at book map right so great short setup here in Meta 310 call wall resistance level and maybe the 300 key gamma strike as support note the shift in order flow here at this reversal over earlier aggressive buyers into this resting liquidity at the 310 level call buyers take their foot off the gas aggressive sellers start to come in shown by the magenta volume dots and price moves lower than all the way down to the 300 key and the strike and hello trading sale says he's back from Italy San Remo back to work trading options welcome back glad you're here all right so great short setup in Meta thanks again slow to sorry for pointing that out all right the next one I want to take a look at is Microsoft and I want to take a look at is Microsoft be zoom in on this just a bit all right let's go take a look at hero and see what options traders are doing solely puts and calls shown a separate lines go to Microsoft zoom in on this take a look at the morning so this is showing from the open just like Meta traders were buying calls and right around 10 a.m. they take the foot off the gas and they take the foot off the gas one small buy or one buyers come back in call buyers again they take the foot off the gas and price moves lower not near not nearly as dramatic as Meta but price started to move lower just about the same time that everything else did right around 1245 and the call buyers became call sellers all right let's go back to book map so that's Microsoft and not nearly as big a move as Meta but still kind of the same driver call buyers become call sellers take their foot off the gas and price moves lower let's take a look at one other back to total signal look at Netflix thing I want to point out here is the these alerts especially this one right around 950 that may be difficult to see but good indication for a short so these new these alerts just became available on Monday so it's going to take some time to to watch them and to understand you know what based so when I the idea is when I see an alert I'm going to look at heroes see what heroes do doing and also look at book map alright so I I actually have Netflix running on my other computer so I don't have much time left I may not may not look at that today but Netflix that was a great entry point for a short whether you bought a put bought a put spread sold stock all right let's let's scan through now I've got about 10 minutes left let's scan through first of all SME 500 the NASDAQ then we can scan through stocks and see if we'll see if we can find any setups first of all let's check the alerts alright here's one this is a different type of alert the NVIDIA call wall breached I'm just zooming out to the entire day so Netflix has been bearish so it looks like maybe this right so this alert comes in at 120 so NVIDIA move below the call wall at 435 then moved above let's go take a look at that in in book map so so far for the day though the hero signal is very bearish so it looks like there was a move below the call wall then above the call wall which triggered that triggered that alert let's see what traders are doing so so far that for the day they are buying their selling calls and selling calls and selling puts so the calls shown with the negative notional value there the falling orange line and this number positive notional value for the put line indicates their selling puts but the call sellers much more aggressive than the put sellers let's go take a look at book map go to NVIDIA so NVIDIA made a series of calls and selling puts NVIDIA so NVIDIA made a series of lower highs then broke out of this pattern right around 1130 as traders were mainly selling calls and those lifestyle says can gold sir I assume you want me to take a look at gold so I'm good I can take a look I don't have gold in book map let's see if if it's available in hero so I can now gold futures are not here so we can take a look for GLD so that is here right so it looks like traders are taking negative delta positions in GLD note there are a couple of alerts here so in GLD traders are for most of the day they were selling calls and buying puts then call buyers started to come in right around 1230 but so far price is not responding alright so that's that's all I have for gold again don't have don't have gold futures here either in book map or in in hero alright so we found another setup in NVIDIA let's check alerts again I don't trade down but we can take a look at this there's not much so here's actually the latest alert in GLD not sure how to interpret that with the this bump up in the hero signal it looks like traders are starting to take positive delta positions and maybe that would be a mean reversion type of alert or let's take a look at the SMB 500 so now it looks like traders are starting to take positive delta positions let's go take a look at book map so the SMB 500 consolidating right around that 4274 level I'm not sure what this level is I've just got that 426 level I've got the wrong color label there alright so that's spy 426 also the 4274 level price consolidating it looks like large traders are starting to come in we've got collected enough MBO data to see some large traders coming in buying with iceberg orders that's shown by the rising light blue line let's take a look at NASDAQ also consolidating maybe finding support at the 665 zero gamma level here in the sub chart order flow not looking as bullish as the SMB 500 all right to Rajam on I'm sure I'm not pronouncing that correctly says JP Morgan rolled their collar excuse me do you have the new strikes so I know for the current collar the one that expires today 42 10 I believe was the was the put all right great thank you so the new JP Morgan collar is the short 4500 call I assume long 40 50 put and then the short the 3410 put right so it looks like NASDAQ attempting to move higher let's see what options traders were doing so to Rajam on says they may also revise by end of day right thank you for that update let's go take a look at hero for NASDAQ right so traders continue to take positive delta positions and NASDAQ NASDAQ may be responding higher also in the SB 500 trading traders are starting to take positive delta positions starting around 215 or so 220 so let's go to book map SB 500 so if I were looking for a trade in NASDAQ I would look for a breakout of either out of these 357 to 358 range same for the SB 500 that is the 426 level and the 427 level order flow based on the sub chart does look a little bit more bullish in the SB 500 we know that traders are starting to take positive delta positions again so maybe we'll have a late afternoon put Vanna rally all right my time is up I want to thank everyone for watching thank you very much for your questions and comments sorry about my technical issues I will be troubleshooting my PC this week considering buying a new Mac M2 M2 studio so maybe that'll work out again thank you very much for watching thank you for your questions and comments have a great weekend and I will see you on Monday bye