 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 Disclosures. General Disclosure, all Bookmap limited materials, information, and presentations are for educational purposes only and should not be considered specific investment advice nor recommendations. Disclosure, trading futures, equities, and options involves substantial risk of loss and is not suitable for all investors. Past performance is not necessarily indicative of future results. The focus of my presentation and the focus of the options-doug chat channel and Discord 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 to 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 of my process is execution. And I look at real-time order flow in Bookmap and real-time market maker hedging flow in SpotGammaHero to confirm my thesis. And just to be clear, when I talk about setups, I will be talking about setups in an underlying asset that can be taken any number of ways with futures, options, or shares. So for example, the S&P 500 can be traded with the ES futures, SPY shares, SPX options, or SPY options. And questions and comments are welcome and I will be watching the options-doug chat channel and Discord and the chat and YouTube for your questions and comments. So please post your questions and comments. It will make the presentation more interesting for me and hopefully for everyone else. All right, let's get started. And today I think is probably the calm before the storm, which we'll begin later on this week. And I'll talk about that in just a minute. So my agenda for today, first of all, I'm going to go over news items, data that was released this morning, as well as data coming up for the rest of the week, and events, and earnings. All right, so for today, the PMI manufacturing data came out at 9.45 AM and 10 AM. I think the construction spending data came out at 10 AM. So that was today, and then tomorrow, AMD reports after the market closes, and then on Wednesday, that's when the storm begins, Wednesday morning PMI services data comes out at 10 AM. And let's just take a look at this in the economic calendar. So this is May 3rd on Wednesday, services PMI at 10 AM Eastern time, and then the big event of the week at 2 PM Eastern time and 2.30 PM Eastern time is the FOMC announcement at 2 and the press conference at 2.30 PM. And the announcement will come out during my session, and I will be watching the S&P 500 at that time. All right, so that's Wednesday, big event for the week. And then Thursday, Apple reports earnings after the close, and then on Friday, the employment report comes out at 8.30 AM Eastern time, the first Friday of the month. So the big events for the week are, of course, the FOMC on Wednesday and the employment report on Friday. All right, let's go through our positional analysis now. And we'll look at the S&P 500 and the NASDAQ. We'll start with the S&P 500. This is book map showing the ES, S&P 500 futures. And before I dig into this chart, let's take a look at a larger time frame. I'm going to start with a 20-day one-hour chart for the SPX, and this is showing just price, again, for SPX, and some of the key spot gamma levels, as well as the expected move for the day, shown with the dashed light blue lines, and then the expected move for the week. And this is based on the options market, and how the options market is pricing in those moves. So the key spot gamma levels. First of all, here's the put wall at 4,000. Again this is SPX, and that's the strike with the largest net negative gamma that can be expected to act as support. And that is also the key gamma strike or the absolute gamma strike, the strike with the largest absolute gamma. And then the volatility trigger is at 4,145. And that is spot gamma's proprietary gamma flip level. Below that level, market makers position on the gamma curve is negative, and they have to trade with price to hedge their delta exposure in a negative gamma environment. And then on the other hand, like now, market makers position on the gamma curve is positive, and they have to trade against price to hedge their delta exposure in a positive gamma environment. So above the volatility trigger that tends to subdue volatility with market makers trading against price. And that has been the case for most of the last month in a positive gamma environment. And then of course below the volatility trigger with market makers trading with price that tends to enhance volatility. Right, so again right now SPX is trading above the volatility trigger in a positive gamma environment. And then finally the call wall at 4,200, that's a strike with the largest net positive gamma, and that can be expected to act as resistance. So those are the primary daily levels that I follow. There are some other levels shown on this chart. So let's see what's in play for today. And we'll take a look at another thinkorswim chart. And this is SPX, again a thinkorswim in a one day, one minute chart. I'm going to zoom in just a little bit here, drag this down. Not a lot of movement today as can be expected with the big events coming up later on in the week. Note this, 4,186, this is a combo L5 level. So that means that it's combined SPX and SPI gamma into one level. And the L5 means that it is the lowest significance of gamma on the scale of one to five, one being the highest five being the lowest. And it did act as resistance earlier today. So those are the levels that are in play. Here's the volatility trigger below, the call wall above, and SPX is trading within the expected range for the day, shown by the dash blue lines above and below. All right, let's take a look at the NASDAQ now. And I'm going to take a look at a QQQ chart to see what levels are in play. So here's QQQ, and note this L2 level at 322 was in play earlier this morning with price chopping, oops, wrong tool, sorry about that. So this L2 level, large gamma 2, and note price chopped around that level for a couple of hours this morning, and then finally broke above. And the next level above is the 325 level, and then there's L1, large gamma 1. So both these levels, 322 and the 325 are significant gamma levels. All right, let's take a look at book map charts now. Again we'll go back to the S&P 500, and again a pretty narrow range today. The only level in play again was this combo C5 level, and I'm showing levels on with two different columns here. This is spot gamma cloud notes, and just like thinkorswim these are provided to spot gamma subscribers for a variety of platforms, and for book map they're provided in the form of cloud notes which are updated automatically. So again here's this 4186 level, and I'm showing that at slightly lower in my cloud notes columns here, and I calculate that difference between ES and SPX every day. So right now it looks like spot gamma is using a 19 point difference between ES and SPX, and I calculated that difference at 18.5 points earlier this morning. So I'm showing the 4186 level slightly lower, and I'm also showing key spy levels. There's the 415 key gamma strike, and that has not been in play even going back to the overnight. All right, so that is the S&P 500 levels, and let's take a look now at the NASDAQ levels. So here is the 322 level that I mentioned earlier. Just below the NASDAQ NQ 13,300 level, a lot of chop around that level. All right, so not a lot of levels in play. Let's take a look at shifts in levels, and first of all for SPX the volatility trigger did shift higher from last week. It shifted higher from 4,110 on Friday to 4,145, and then the spy key gamma strike shifted higher from 4,10 to 4,15, and I interpret that as bullish, and then for QQQ the volatility trigger dropped lower, and the put wall also dropped lower. So minor shifts in levels, and let's take a look at the gamma levels now to see where these come from, and we'll start with SPX, and here is the 4,000 key gamma strike and the put wall. That's a strike with the largest absolute gamma. The orange bars are showing positive gamma or call gamma above the zero line. Blue bars are showing negative gamma or put gamma below the zero line, and this is market makers position at these strikes, and note their significant gamma at the 4,100 level which is noted as support today, and then also at the 4,150 level which was also noted as support in the spot gamma AM founders note, and then here's the call wall, the strike with the largest net positive gamma, and that can be expected to act as resistance. And depending on what the Fed has to say on Friday, it's likely that this will be a target sometime this week, probably starting it. All right, that's this SPX, let's take a look at spy, take a look at the gamma levels, zoom in on this chart. So for spy, 400 is the put wall, the strike with the largest net negative gamma, and then 4,15 right here, that's the key gamma strike or absolute gamma strike, strike with the largest absolute gamma, and then here's the call wall. Also a likely target later on in the week, again depending on what the FOMC has to say. So there's the ceiling and the floor currently for spy, we'll try this, but most likely I'll have to do a refresh, yep. So let's take a look at NDX now, and here's the 12,975 strike, this is the key gamma strike or absolute gamma strike, as well as the call wall. And the put wall is at 11,000, it's not shown on this chart and not in play today. And then finally we'll take a look at QQQ, zoom in on this chart. And for QQQ, 320 is the key gamma strike, as well as the call wall is at 330, I'm sorry. So 320 is the key gamma strike, the call wall is at 330, and then the put wall moved down to 300. So there's the floor and the ceiling for QQQ, 300 or 330, with the key gamma strike at 320. All right, let's take a look at one other thing here. This is the Vana model, and this is showing how a market maker's delta notional shown on the vertical axis will change with changes in price, shown on the horizontal axis. And there are two curves on this chart, the first, the light gray is just showing how market maker's delta notional or delta exposure changes with changes in price. And what this is showing is market maker's delta notional will increase as price increases and they have to sell futures to hedge their delta exposure, again as price increases. And that's typical of a positive gamma environment. And then the purple line adds the implied volatility component to the equation. So that's showing how a market maker's delta notional will change with changes in price and changes in implied volatility, and that is the Vana effect. The change in delta with a change in implied volatility. And again, this is showing as price increases, market maker's delta notional will increase and they'll have to sell futures. And then on the other hand, below about, and according to this chart, below about the 41, let's say around the 4180 level, market maker's delta notional, according to the pink curve, the purple curve, will start to increase and they'll have to sell futures as price continues to drop and implied volatility increases. All right, so that's the Vana model, always important to keep that in mind, knowing how market makers are likely to react with changes in price and implied volatility. And let's take a look at some data now. And this is an indication of market maker's position on the gamma curve. And I'm going to look at two things here. And this is for SPX, SPI, NDX, and QQQ. And in the past, I've been looking just at this gamma notional number, but that number has changed when spot gamma changed the interface on April 1st. So the numbers changed and it's hard to compare with the numbers previously. But the spot gamma index has remained the same. So that's what I'm starting to look at now. And this is a proprietary spot gamma index that is a proprietary measurement of the total amount of market gamma. And what this is showing, all these numbers are positive. So this is indicating that market maker's position on the gamma curve is positive and they will have to, again, sell futures to hedge their delta exposure as price increases. So they're trading against price, and that tends to subdue volatility in a positive gamma environment. And that's certainly a partial explanation for the lower trading range today. All right, let's take a look at some setups now. Oh, one other thing that I wanted to point out. Let's go to, this is Thinkorswim for SPX. And this is an options chain. And recall, for SPX, there are options that expire every day. And this is showing up here the expected move, actually let me, expected move for today, tomorrow, and for Wednesday, the FOMC day. And note that the implied volatility for today, 18.4%, and then for tomorrow, 13%, and then up to, again, 18% on Wednesday. Not a large change, but note the expected range for Wednesday at plus or minus 47 points. So a pretty big jump between Tuesday and Wednesday, expected range going from 24 points tomorrow to 47 points on Wednesday. So this is not nearly as extreme as past FOMC announcements and meetings, but there is a change in implied volatility and expected range for Wednesday. All right, let's take a look at some setups. I'm going to start with the S&P 500. And this is the combined signal. This is the hero signal. The bridging impact of real-time options provided by Spot Gamma, two subscribers. And this chart is showing price with a white line, the hero signal with a purple line. And this is showing options trades for SPX, SPY, XSP, and ES futures, all into one combined signal. So showing how traders are buying and selling calls and puts and how market makers are hedging that activity. And note it is negative, negative delta today, total signal at minus 2.36 billion. So net net and all these instruments, traders are taking negative delta positions. And let's just see what they're actually doing. All right, so they are buying puts that's shown by the falling blue line. And they're actually also selling calls. Note both these numbers are negative, but this is not calls, not significant. You can just tell by the flat line there. It's jumping around minus 30 million versus the put number at minus 2.45 billion. So traders are selling calls, not very aggressively, but they are selling calls. And they're definitely buying puts. And so far that has not really had a strong influence on price. All right, let's slice and dice this a little bit more and take a look at the individual signals first. So I'm going to start with SPX and pretty similar to the total signal. Negative delta trending down, total number 1 minus 1.33 billion. Take a look at SPY, pretty similar picture, minus 1.3 billion. And then we'll take a look at ES futures. And this number is pretty new, and it's actually been pretty interesting to watch. It's much smaller compared to SPX and SPY. But it seems to be tracking price pretty well. So it is positive 200 and looks like 269 billion. All right, let's go back to the total signal now at minus 2.47 billion. All right, let's see if we can find any setups here. All right, so this is the best setup that I saw this morning using Hero as a signal as well as using hedging flow and order flow as a signal. And note that price was increasing and then Hero started made an equal high, or price made a higher high, and then started to move lower. And that set up a short right around 11 AM. So let's go take a look at that in book map now. I'm going to zoom in on this part of this chart. This is where the most interesting movement took place. So here's that reversal at 11 AM. Note, as traders were taking negative delta positions, order flow shifts from bullish. See all the green dots there to bearish. These green volume dots are showing market buy orders, aggressive buyers. And this is at the ES 4200 level. Price starts to shift lower. And you can see the cumulative volume delta line here, this pink line falling, confirming the shift in order flow from bullish to bearish. So that was the first setup, short setup confirmed and pretty clear to see in the hedging flow in Hero as well as the order flow in book map. All right, let's go back to Hero now, zoom in full screen. So there was the short setup. So the expectation for today, given the positive gamma, there was pretty much a flat opening. My expectation for today was a range day. Fade the highs and buy the lows. So, you know, fade the highs, fade the lows. So here's the confirmation of a short setup. Again, Hero makes an equal high, then starts to move lower. At the same time, price moves lower. Setting up that short at the ES 4200 level. And then note, Hero starts to increase and price moves higher. So let's go back and take a look at book map now. So here's the long setup. This was not really as easy to read. Probably better to wait for confirmation of higher lows and higher highs. Even this break above VWAP. That's where the order flow really shifts more bullish. With a price target at the previous high, 4200, and the 4186 combo 5 level. Right, so that's the S&P 500. Good short setup and a long setup. Confirmed by hedging flow and order flow. With the expectation of a range day today, trading range. Identify the lows, identify the highs. Buy the lows, sell the highs. All right, so that is the S&P 500. Let's take a look at NASDAQ now. Let's go back to Hero. And for Hero, we can look at either QQQ or a combined signal for NDX and QQQ. And let's take a look at the individual components first. Let's go to QQQ. And really not much of a help here for QQQ, NDX. Pretty insignificant delta notional here. But we can take a look at the combined signal. We'll type in NASDAQ here. And RJ asked, given how negative the S&P 500 Hero is, would you be looking for a short now? And yes. So certainly want to confirm that with order flow and book map, as well as a reversal level. So we'll go back and take a look at that in just a minute. I just got this NASDAQ combined signal. So this is combining NDX and QQQ into one signal. And let's zoom in on this. And Hero was pretty choppy in the morning. Let's just zoom in. And really just looking at this, there was no way to confirm for sure that this move was going to move lower. Let's take a look at order flow for NASDAQ here. And the order flow definitely helps to confirm the signal of a short. So we're looking at 11 AM, this reversal right here. And note the liquidity. Let me just dial this up a bit. I'm talking about the limit sell orders there in NASDAQ. There's typically not a lot of liquidity in NASDAQ. But you can clearly see it there. Price is that level at large for NASDAQ. Iceberg order comes in, sell iceberg order. And the shift in order flow is pretty obvious there. Green volume dots and the shift to pink volume dots, aggressive buy orders, market buy orders. And then the aggressive sellers come in. And price starts to move lower. And you can see the shift in the cumulative volume delta. So there's the short set up just below the QQQ 323 level. And then it takes a while for price to get going higher. Let's take a look at, go back to hero. And for NASDAQ, there was really no confirmation for hero for the move higher. Hero continues slightly down. Now currently, the total signal is at minus $131 million. And notice that compared the numbers with the S&P 500 for NASDAQ, minus $131 million versus over $2 billion for the S&P 500, the notional value. All right, so that's NASDAQ. Confirmation of a short and nothing really for this long as far as the options traders going. All right, let's take a look at, RJ was asking about the S&P 500 again. And let's take a look at that. So we'll go back to the total signal. And hero is definitely trending down. So we were just looking at NASDAQ at minus $131 million. This is minus $2.5 billion. And hero is definitely trending lower. All right, let's go take a look at book map. So right now it looks like ES is definitely making a series of lower highs. I don't know, I would certainly be cautious here, but I would also definitely be leaning to the short side. Let's just take a look at something else. I'm looking at another computer here. I, you know, today there's not a lot of range afternoon session. So far, icebergs have been selling today, net selling. So this iceberg number I'm looking at at the bottom. In the sub chart here, this is negative. Cumulative volume delta negative, but stops are positive. All right, let's take a look at some stocks. There were actually some better setups in stocks. And I'm gonna start with the best. And here's NVIDIA. It looks like I need to add more lines above 290. So great uptrend here in NVIDIA. And the stocks that I follow and have in book map, this is definitely the best setup. Let's go take a look at HERO. Take a look at NVIDIA. And NVIDIA, we'll zoom in on this. Call buyers were definitely driving the stock hire. And that's shown by the rising orange line there that indicates traders are buying calls. Market makers are selling calls. And they have to buy stock to hedge their delta exposure when they sell calls. And that can really drive price hire. And note the call wall at 290, price target, and potential resistance level. All right, let's go take a look at book map now. So we know that traders were buying calls from the open, aggressively buying calls. And it looks like they continue to buy calls. And we'll watch and see what happens at the call wall, whether they reverse course or continue, or just flatten off. Let's go back and take a look at the total signal now. And go back and take a look at book map. So here's NVIDIA at the 290 call wall. And note liquidity that came in at that level at the open. Those are limit sell orders. Traders want to sell at that level. And that liquidity tends to attract price. And for NVIDIA, it's often at the big round, the fives and the zeros, big around numbers. Great uptrend in NVIDIA. And RJ says, great place to take profit. Yes, absolutely. You know, if you've got the move from 278 or even 280 up to 290, bought a call or just bought shares. Yeah, you did great today. All right, so that was the best setup in stocks. And let's take a look at a few others. Take a look at AMD and remember AMD reports earnings after the close tomorrow. And remember NVIDIA was the best stock setup in the stocks that I followed today. So everything after this will not be nearly as interesting. So here's AMD confirmation short in the morning. And this is what I'm looking at. The following purple hero line and price responding. And it looks like it's also a confirmation long around 1030. Let's go take a look at book map. So here's the short in the morning. And then kind of a grind higher after price reverses just below the 89 level. And note, I believe 90 was the key gamma strike. That's right, 90 is the key gamma strike. All right, the next was Amazon. And note the levels that are in play for Amazon. Here's the 105 key gamma strike price. Drops below that immediately at the open today. And then now it's trading below the hedgewall. The 105 key gamma strike and the 104 hedgewall. And remember Amazon reported earnings last week and initially traded higher than traded lower after that. So let's go take a look at book map. Now we'll take a look at Amazon. So here's the reversal or not actually just the move lower at the 105 key gamma strike at the open. Amazon makes a series of lower highs hitting liquidity targets below at 103.50, 103. And then now heading down to 102 potentially. It looks like some traders are front running the others at around 102.10. So there's Amazon short. And now let's take a look at, and I don't have it up on this computer, but I wanna take a look at IWM. And just for those of you who spot gamma subscribers or those considering or new to spot gamma the alerts. These alerts I wanna point out are available in the dashboard and note the call wall, the note about the alert for the Nvidia call wall breached. And that just happened about nine minutes ago. This is what I wanna look at this AM IWM call wall breached in the morning, 1046. So here's the call wall right at this level right here. And note this would have been a good level for an options position. And this is one way that I'm thinking about using these alerts. So here's the IWM call wall breach alert. And you could have played this by selling a call spread, buying a put, buying a put spread or just selling IWM outright. So this is something that I'm starting to look at as playing these alerts. And there's one example. Just seeing this IWM call wall breached go over to your platform and buy a put, sell a call spread, buy a put spread or sell shares. So RJ says, Nvidia call wall doing its thing. So let's go back and take a look at Nvidia now. We'll go to book map, go to Nvidia. And so far that was good for a one point reversal. Looks like bullish order flow coming in again. Let's go back and take a look at IWM. We'll take a closer look. Zoom in. Let's go back to a shorter. We'll go take a look at a shorter look back period. So note that traders, they started taking negative delta positions as price was approaching that level, took one more shot at it and then at 270 started taking negative delta positions again. So first of all, and so far for today, the call wall and the liquidity at that level has been a target, a price target. And now it looks like a potential resistance level, which it should be. That's typically how the call wall behaves. And I think one factor that may contribute to this call wall acting as resistance, and this is not a recommendation as the time of day, that typically stocks rally pretty strongly in the morning session and chop around during launch, it may continue higher. But if this was, NVIDIA was hitting the call wall this morning with, in the morning, early in the morning, with traders buying calls as aggressively, then I would look for a breach and move higher as that the calls at the call wall went into money and started to increase in delta and market makers had to continue to buy stock to hedge their delta exposure. Well, let's take a look. Let's go back to the total. And we can see that so far this call line is leveling off. So gradually increasing up to the 270 call wall and then slightly down. All right, so the next, let's take a look at Tesla. And Tesla, there was a nice divergent short this morning. So note the hedge wall in play at the 163 level. I'm gonna zoom in on Tesla and here's the divergent signal. So hero makes a lower high, his price makes a higher high up to the hedge wall and then reverses lower. So about 1015, 1020 price reverses lower at the hedge wall. And that level can act as support or resistance and here it is clearly acting as resistance. And let's go take a look at book map. I'm gonna zoom in on this on the morning session. So here's the reversal at the 163 level and really not a lot of confirmation or clarity and order flow, but definitely in hedging flow. Traders were taking negative delta positions as price approached that level. Price target at 160, the high liquidity at that level. And then it looks like price went down one more dollar below to the 159 level. So there's the short set up in Tesla. Good for about four points. And let's take a look at hero one more time and then there's a confirmation long. Hero starts to move up and price follows. And note now that price has leveled off as hero has leveled. All right, I've got a couple minutes left. Those are all the stocks that I wanted to take a look at. Let's go back to the S&P 500 and to see how that's playing out. So it looks like the S&P 500 is grinding lower. Let's go take a look at book map and definitely grinding lower in slow motion, as RJ says. And short after initially price finds support at the 4200 level and then finally it looks like that starts to act as resistance. So there would have been a good short set up right around 4200. So far good for about five points. And again, recall that traders are definitely taking negative delta positions. Let's just see where. Check the notional value on hero now. 2.9 billion negative. So this is definitely a slow motion short set up. And a more aggressive entry point would have been that 4186 level, SBX 4186. And a less aggressive would have been the ES 4200 level. Let's do a final check of NASDAQ. See if that's following along and slowly rolling over. Take a look at book map. So it looks like the NASDAQ chopped around the 13,350 level for quite a while before finally breaking down below the 323 QQQ 323 level. Yeah, that's RJ says though it's funny how it can be that way slowly and then the dam breaks and you get a whoosh down. So, especially in the NASDAQ. All right, that's my time is up. That's all I have. Again, we're in the calm before the storm. Looking for a big day on Wednesday. And we'll talk about that more tomorrow. So I want to thank everyone for watching. Thanks for your questions and comments, RJ. Appreciate your participation. And I will see you tomorrow. Thanks again, bye.