 Good morning traders and welcome to the bookmap pro trader webinar. Actually, this is recordings here today. We have the pro trader webinar series with Brent Kachuba from Spot Gamma may have heard of him these futures and stocks and options of course a trader he's going to go over futures and stocks and Brent has a long history here trading equities and derivatives 20 years B of A credit swiss in an equities broker in algorithmic sales and trading Following that he was in institutional sales for wolverine Representing their electronic electronic derivatives trading platform currently Brent trades some proprietary strategies strategies and runs spot gamma.com which publishes various metrics on options data various metrics many many metrics as you will probably see here Here's Brent's contact information or spot gammas contact information if you are interested in this You have the website From the bookmap marketplace here, you will get access to I'll show you this in the bookmap marketplace You get access to the hero indicator Also their levels You have their email here sg at spot gamma twitter handle And then also there's special offering here if you want to click on this link I will put this into the chat for you guys So that so that you have it But let me just show you the bookmap marketplace really quickly here So that you understand What this indicator is in in a little more depth here. So we'll go to the bookmap marketplace Okay and Go up here go to the home page and here it is right in the top left corner here So, yeah, you can read about it here. There's a few different products. They have in here the heroes hero level it's you know, which is hedge impact real-time options and also some options gamma levels etc So without further ado though, let's just turn it right over to Brent and let him take it away Yeah, thanks Bruce. How you doing? I'm doing well doing well. So Yeah, looking forward as always to what you're going to have here in the in the toy chest here to Go through some of these magical options levels here. Yeah. Yeah, so Every time we get a market like this is that I forget what movie it's from It's always that I love the smell of napalm in the morning I love these markets when they finally move, you know So I was gonna we're going to cover the hero indicator and just give her I'm going to quick overview of that because the market is so active. Excuse me I want to leave a little more time kind of at the end to show the live hero screen We could talk about that. I have a few stocks loaded up take some questions on that But what we're going to do quickly is just touch base on uh spot gamma what hero is and then I have some data now Which is new so even if you're sort of used to my hero spiel I actually have some great data that shows how the Options print and that invokes stock volume and then you can see the stock move along with that. So it's pretty neat So just to get a quick idea of what of who we are at spot game. We produce options based levels for Trading stocks and futures. So we analyze the options market and from that we produce Levels at which we think hedging flow that is bank market maker hedging flow We'll show up around those options levels and then we also predict volatility Which is a base which is based on the options position as well So we'll mean by that if you look at today's current market. It's really very volatile We predicted that if the market broke basically 44 50 44 25 somewhere in that area last week that volatility would really pick up substantially And you can compare that to some of the notes we put out two weeks ago Where we said look, you know, nothing's going on might as well finish up your labor day vacation So the volatility forecasting I think is really helpful in in combination with some of the major levels and kind of as an incident Just to note we have 43 70 in spx is the level we put out this morning I could show you on the chart as a major kind of inflection point Which is what the market is trying to digest at the moment So as we sort of move ahead again, I just talked about these major levels in your bookmap system You can use cloud notes and automatically load those levels in so each day Each morning, excuse me around 3 a.m. These levels update And the show where we see the biggest inflection points that are support and resistance In the market based again on those options positions and the spx and the spy in if you're looking at futures So let's talk quickly about the hero indicator. So the hero indicator is something that we've produced along with book map as a partner that we Read all the options trades in real time. So it's the entire options trade feed right all the bids and offers and quotes And we figure out what are the biggest and most important trades taking place and we Published a stream of those trades on the book map screen And our belief here is that when large options trades are taking place that invokes dealer hedging or market making hedging and that hedging flow Can move Stocks and or futures around and we have a bunch of data to back up that statement So hero simply stands for as bruce mentioned earlier the hedging impact of real-time options So again as I just sort of noted This the big options trades leads to hedging flows and those hedging flows We believe are the most consistent source of flow in the market when you're talking about stock and options And the reason we believe is because the options market is growing There's a lot of data out. For example, if you go over zero hedge, you can poke around for this chart Believe I put it on twitter as well. But the options market has grown again in size It's you know record volumes in the options market in liquidity in the underlying in the in the es in inequities It's been very flat. So if you have more options flow, you have more hedging flow Which in turn indicates that the options market could control or the hedging flows could have more of an impact On the underlying stock in the way that they move So not only is the options market larger Equaling more hedging flows, but if you think about market making flow in general, they're trading their gamma, right? They're constantly having to rebalance their book So if you were to compare hedging flows of like a big pension fund, you know every quarter they come in They rebalance and then they're done trading, right? But the market makers they rebalance, you know at friday's close They got to rebalance again on the open if the market moves a bunch in today They got to keep trading so that hedging flow is persistent. It's always there And so that is why we say it's the largest most consistent flow Obviously one big hedge fund comes in or a giant pension fund comes in they may move the market for an afternoon, right? But the but the market making flow is going to show right back up the following day Just a basic overview of how delta hedging works If a trader Be it retail or some other fund buys a call That means that they're buying from a market maker or Dealer that means the dealer short the call and they would need to buy stock as a hedge, right? So these are the underlying basics of order flow and how we think that these things Can impact the stock So when you're looking at the hero indicator in the readings what we're showing you is the Hypothetical position that the dealer has to hedge. So if the hero reading is positive That means that market maker would need to possibly offset, you know the risk that they have And and buy stock So again, if the hero readings positive, it means that the traders are buying calls or Selling puts which means that a market maker would have to buy stock as you can see on this table There's really two ways as we mentioned before that the hero indicator is useful one It will help you spot large interday trade So did a did a really big whale come in and just sweep the book sweep all the options book and say amc So that's a that on screen immediate impact of a trade We think we do a great job of highlighting and letting people know when a trade took place The other thing that's interesting is that you can Use the hedging impact tool which we show the cumulative flow over the whole day So you could tell at the end of the day, okay Look people are really buying a lot of puts day or selling a lot of calls or whatever it may be And that could lead to end of day hedging, right? If the hedging flow is very negative through the day Then maybe market makers have to sell into the close to to hedges their books. So you can figure out Get some insights on which way people are leaning or dealers are leaning. Excuse me And then kind of the third obvious one is is sentiment, right? If you know, everyone's buying calls the hero indicator will be very positive And that can give you some information, right that maybe is this setting up for a gamma squeeze for example or look You know like today in the s&p will take a look at the indicator and see our people buying puts, right? Can we figure that out here and what how is that going to? Help me estimate what the market is going to do not necessarily today, but tomorrow on the next day, right? So that sentiment indicator is an important thing to realize as well So the the way that the hero indicator works We have Two ways of showing you the flow one is what we call the on chart indicator And there's these small little triangles and the triangles can show up with every single option trade that takes place So for the s&p or apple, there's millions of trades that take place every single day Excuse me millions of contracts that trade every single day and we show you the size of that Trade as indicated on screen. The second way is this rolling sum that is at the bottom of the screen here The rolling indicator is the sum the rolling sum of all the individual trades. So the individual triangle so to speak That take place on the day. So the cumulative indicator is what you would look at to see Okay, what is the flow over the day over the last hour, etc? So so we try to contextualize The information for you in a few different ways It's important to note that this is all configurable right all the little triangle icons everything that you see on my screen Or in any of these pictures you could change the color the size of the shape Not the shape the color and the size of the triangles or simply remove those from your chart and just view the cumulative indicator so you have some ability to Overlay this information onto your custom book map setup And a lot of people are very particular about the information they're seeing and we want to sort of embed ourselves alongside Of your existing setup and not sort of force you into a certain view So let's take a quick example Of the way that the hero indicator would work in this case here We're looking at game stop this chart is from a few weeks ago But what you'll see here is the stock moves higher And then out of the blue here you see suddenly this hero indicator drops very sharply So this sharp drop is telling us that negative delta trades hit the market Now negative delta trades has to be either somebody's sold calls or they bought puts And the reason that we look at delta is For those of you who are a bit new to to options trading to hedge an options trade You would monitor the delta of that options trade The delta is telling us a number of shares that need to be bought or sold in order to neutralize the directional risk of an option So if bruce was to buy a put for me if i'm the market maker bruce buys a put I'm now sure to put as a market maker and I need to hedge that directional risk Right so the way that I do that is I look at what the options delta is we have trading systems that tell us that And so for example, if the delta of that option is a 50 That note that means that I need to buy 50 shares of stock for every single option that bruce bought for every single put option That bruce bought so you can see that a bruce bought 10 000 puts He likes to really sling those trades around and I need to buy 50 shares for every put that he Bought and so you could see how that could impact or or have a major force or or influence on the way stock moves So in this case again Right off the top of the stock huge bearish flow comes into the market In the option side and you could see how sharply the stock drops, right? So the information here to me is very valuable in that I know that dealers likely will need to sell here But I also know that if the stock suddenly drops, you know, it's a three dollar drop You're you might be looking for news, right? You might be on your discord chat or on your message board saying why did the stock just drop You know three four five bucks. Oh huge options trade, right? No news. Nothing else out there It's an option trade So that gives me this information now that if I wanted to like look into buying the dip after this trade I also have a little more confidence in that because I know I have information as to why the stock Decline in the first place, right? So there's there's different dynamics of how you want to look at this the the options flow in the hero indicator And what you may draw or lean from that Can you can you go back to that one for just a moment if I can interrupt you here? So I know that I can't quite read it in the in the image there, but some of the Red triangles there because there's quite a few green triangles But the red ones, can you explain a little bit more about about that? Sure. So the green triangle is a positive delta trade and the red triangle is a Negative delta trade. So if I flip back to this original chart here A positive delta trade is if someone buys a call or sells a put So either of those two buy call sell put those would invoke a green triangle or or or Causes a place a green triangle and if somebody sells a call or buys a put that's a negative delta triangle, right? Stensibly in a bet that the market is not going to go up and that would be a red triangle. So Back on this chart here You'll notice that there's green and red triangles But inside of the chart and I apologize you can't read this is a number And the number tells us the size of the trade that took place So the bigger the number the larger the size So that's why the cumulative indicator can be helpful because as you know There's a bunch of green triangles here too. And so you say well It's not it's not simply the number of triangles that you're seeing it's the actually the total delta, right? So what I mean by that is you could have 50 green triangles here That all have let's say a 10 in them, right? But then you get one red triangle that has a minus 10,000 and your net flow from that Period is going to be minus 10,000 basically right because those green trades the green triangle trades are so small So You know in other words all day long, there's a lot of small retail trades for example, you know People buying through robin hood to buy a one-lot call etc etc, but then all of a sudden at 12 o'clock, right? Bridgewater or some massive hedge fund comes in and buys a hundred thousand puts Well All those little retail trades don't matter anything if bridge water comes in and buys a hundred thousand puts, right? So that's why the size of the trade and this cumulative indicator is helpful because yes You can see on screen the little the triangles which are very useful for placing, you know specific trade Um, but you also need to be cognizant of how big the trade is right the delta size so to speak Yeah, that that's that's excellent. Um, just a note too that you can also filter for those on chart Exactly Yeah Yeah, so in the visual settings you can use this slider and I actually I think we just updated this I need to update the slide here. I apologize for that But you can set the filter to say only show me trades that are above a certain size So that your your on-screen indicator here will just show you and you can see on my screen. I'll demonstrate this Just show me the big trades of the day, right? That's all I really want to see it as a triangle on the screen Because if you view every single trade particularly like apple or spiders, I mean you're looking at Thousands of trades it can be a little overwhelming. It's it's pretty fascinating So let's show how this works in the es and the nasdaq as well Now one of the things that's key to note about the way that we look at the es and the nasdaq We not only monitor the spx and the ndx those are the index options But we also monitor the spiders in the cues and that's really important because the cues If you just look at the nasdaq the cues is a much larger options position than in the ndx index So you really need to be aware of the cue cue cue options trading But the same thing goes for for the s and p flow spiders is at or larger at the moment in terms of options flow than spx index So if you're not watching both you're missing literally half of the picture if not more So when you look at es or nq in the hero indicator, you're seeing both the index and the etf flow combined on your chart So here's a great example This one actually we were giving a live demo back then Of this of this trade i believe where you can see that there's just this giant print that takes place Right. This is somebody came in here and bought giant a giant call position or they sold a huge number of puts and That is a lot of the hero indicator jumps and along with that right off of this bottom You can see that there's a really big 20 handle Move in the futures Right, so this is a this is the kind of on screen I mean, this is a wonderful indication here of the kind of flow that you will see And Oftentimes what you'll you'll you'll also see is that there will be a fade sometimes after these moves take place So maybe you missed the initial move, but if you know, okay market spiked because of this big call trade Now, I know I could fade that right it's not because the fed just came out and said that There were long interest rates or some piece of news I missed huge options trade Maybe I want to fade that move as opposed to try to run with it Right. So again, there's multiple different ways to try to play the the indications In terms of the longer View on the options order flow in this case, you know the market Going into this day was a little bit weak, right? And what we saw is every single dip that came you could see that the hero indicator would have more bullish flow step in And so that gave confidence to buy dips here because the options flow was positive all day Which indicated that call buyers were coming in and then not only that it also indicated that there may be quite Quite a large amount of demand into the close because market makers really need to hedge at the close Hedge their position into the close, right? If people are buying options buying calls all day Then market makers may need to buy some futures to sort of shore up their risk at the end of the day And that goes, you know double for a day like on friday For example, where there's a lot of put flow coming in on the market Market makers need to make sure that they're hedged going into the close that that 4 o'clock 4 15 close is really important To make sure their risk is squared away So that's oftentimes though you can see in the last 10 minutes of the day Just really, you know gappy big, you know 10 15 20 hand of move in futures because look you got to get your risk Your risk right right before the before the weekend or before the before the end of the day A question on on that brent The this might be You know options expiration. I'm not sure but When you see these types of you know Huge accumulation On the options. Do you typically see like a two or three day run to the upside after this? Yeah, it's I think it's situational really Particularly in the call side. I think that's something that you can that you could say is true On the put side, it's a little more difficult to say because the the put side exhausts very quickly if that makes sense So again, we're we're really in the process of gathering lots of data And we're going to be able to start running some of these regressions where you say, okay When the when the hero indicator is very positive one day what happens the next one two three four five days And can we draw correlations from that? But a lot of times I think in the put side we can see exhaustion when it's a really negative day So that can actually indicate a a a flip or maybe a positive day in the next day But you can also see the bullish accumulations will happen on on several days in a row And that can be that can be an indication that that there's some more stabilization in the market In a longer term bull run so Sort of recap. I think on the bullish side you can extrapolate a few days out on the put side or the bearish side That's a little bit harder to sort of had that view Several days out if that makes sense Yep. Yep. Thank you. Sure You know, this this works the same way on the put side as we were just talking about what's interesting here is that the One of the fed governors came out at this time. I don't believe this is actually pal I think this was another meeting and and they Had mentioned something that the market initially took negative or or didn't That was not I think the market was unsure of whether it was positive or negative You know, oftentimes the fed the fed officials will say something in the market digest it very quickly and then the market bounces Right, so maybe we get initial drawdown off the headline reading all goes and then it reverts, right? But in this case you can see that the put buyers really came in off of that news, right? And we could tell it because this cumulative indicator really drops lower I should note too. I in this picture I changed the color of the onscreen triangles to just be gray Just there's another ways that you can see the triangle. So these are the same triangles that you see, you know Here when the red and green is just you could change the color to be gray It's a little easier on the honest in thompson. So at anyway, the put flow came in so that told me that the market is Not looking favorably upon this news, right? So while normally after those fed You know comments, I will play a mean reversion trade, right because the put flow built So steadily that signal to me, look, you don't want to try to buy this dip, right? You want to look to actually either stay short or stay out of the way of whatever may be coming What's also interesting to know about this too is that you could see here at the end of the day, you know Right before five o'clock we talked about having hedging flow into the clothes that needs to adjust and that's exactly what happened here We moved from 4200 down to 4175 in the matter of just a few minutes Based on that, you know hedge adjustment This is a screenshot from yesterday and this kind of leads me into some of the new information for those of you who are Been been using the hero system for a while What we've actually seen what's been really fascinating particularly a few days is that um We're getting some insights into the type of flow that's coming into the market and normally what people say is Hey, you know the hero indicator was positive, but the market went down What's up with that right or vice versa? And what's been really fascinating to watch We put a few different pieces of our information together is There's clearly Volatility trades that are taking place and we're able to pick those up. So what I mean by that is if you are a volatility trader You are going to buy or sell options, right? And you're going to hedge yourself with stock accordingly and That is going to have an impact on volatility in the way that things are positioned. So In this case what you see here is that the options market has a very The hero market has a very bullish Outlook right to start the day meaning this is all positive delta trades to start today Somebody is in here buying calls and or selling puts right But futures sold off hard over that exact same time frame and you can see right around noon The flow stops and it changes right the the hero indicator goes flat Which tells us that whatever sorry, whatever the Start of day flow was it stopped. So whoever was buying calls or selling excuse me Yeah, whoever was buying calls here or selling puts Stop their flow if the hero indicator goes sideways, that means nothing's really happening in the market, right? and whatever the futures trade was That seemed to stop as well and that happened right around the european close. So we think this was likely somebody shorting futures against some type of Volatility trades. So they're they're selling puts Or buying calls against a As a way to express a view on volatility Now what's interesting is the day before this the flow is the exact opposite. In other words, the hero indicator is very negative and the The es went straight up And so what we knew about these days was somebody Closed up a massive strip of in the money calls the day before And the hero indicator was negative because of that but they bought back futures Which pushed the market higher And then if you saw in our daily note, we could see that that left this void, right? This volatility trade left this void in the market that allowed this That allows us to see that hey, you know, there's not that much support and the market sort of back filled again the following day So if you combine this flow, what's interesting about this is is if you combine this flow Even though the market is down this hero indicator is positive You know towards the end of the day looks a little bit negative. It shifted a little bit negative towards the end of the day Which indicated some, you know, maybe people are buying some puts or selling some calls But what's fascinating about this is even though the market is down sharply The vix which you can see here. This is just that last day stayed really contained In other words, if this market was dropping because people were buying puts Volatility would have a massive spike But in this case, this is a five-day chart of the s&p here and a five-day chart of the vix Everything was very contained So what I'm getting at is that yes, this is a big self in the market and you go and you might say to yourself Well, are people buying puts is there a fear trade in place? Well, this is a delta unwind, right? This is a trade unwind and I believe that because again The the synchronicity the synchronicity between the futures and the options market, right, but vol didn't break out Excuse me. Whereas if you look at the move overnight today, the vix went up from 20 to 25 And if we look at the hero indicator, you'll see for today, there's a different It's very negative, right? So there's a fear trade today So how will I, you know, bruce just mentioned this, right? Does this mean something for tomorrow? Well, I think it does, right? If I if I know that this is a long vol unwind Right, then that's a different way to play it Then if I know people are buying puts and the market is scared and there's a fear traded in place So again, for those of you who are watching the es on a given basis Put these two together, right with the with vix or implied vol And and it starts to tell you a little bit of a story, right? And you can combine You can combine this with positioning. How did open interest change? You know, uh, how's gamma positioned? Excuse me And you start to get more of a 3d picture so to speak Um, and and I should note that this is generally only applicable to the es and and and and the x you can see In single stocks, you can see there are volatility traders, but it tends to be more directional flow whereas What we've seen recently particular options expiration is this adjustment that that are clearly volatility trades taking place So the stuff that's new for everybody that I think is really exciting to watch and for those of you who are maybe Considering, you know here or or trying to figure out what the impacts of options is This is really exciting. We've been gathering data for quite a while We've been working on a way to really parse through that data get it in the right, you know Format clean it etc. And we have some really pretty cool charts to look at so The components of hero as we sort of are outlined already is that there's large option trades That invokes big stock volume and hedging activity and that makes the stock move That's the fun fundamental theory behind everything that goes on So let's just take a quick look here. This is a chart of amc for friday Now there's only two things on this chart because I want to make it very clean to look at On the bottom is the stocks volume. So many of you are probably familiar with You know volume profile where most of the stocks volume takes place at the beginning of the day and at the end of Day writes that volume smile and then in lunchtime tends to be the lowest amount of stock volume At the top we have the hero signal. Okay, so the hero signal in this case is bucketed into one Is in one minute buckets So what's the cumulative reading for each one minute reading? So If you were to basically add up all those triangles and just track them in one minute bucket only That's essentially we have and then we have one standard deviation is a red line And then two standard deviations is a green line. So basically the red and green lines tell us what's a big signal So obviously, as you know, there's one massive signal here, right? So giant Hero reading for amc here. It's a negative delta reading So somebody bought a bunch of calls or sold a bunch of puts and then what you'll notice is Then bruce, hopefully you can make this out right here Right after that is a giant chunk of stock volume, right? Option trade takes place massive stock volume takes place And then I highlighted a bunch of other Readings on here as well that when there's a big option print associated with that Right almost immediately these black lines are indicating that are spikes in options volume Or excuse me spike spikes in stock volume. So again, huge option delta big stock volume jump, right So I know what you guys are all saying. Well, what does that mean for the price? So I got you So I highlighted just on this on this very simple chart a red area where the negative delta trades are So if the spike down It gets a red arrow if it's spiked up, we got a green arrow and it's pretty revealing, right Here is that massive trade This first right arrow and then here's the subsequent Giant red trade which is again, you know two or a two one or two standard deviation print And so you can see clear as day here. What what happens, right big Put delta trade comes in market goes down around this bottom is a big green Call trade or somebody so puts one of the two, right? And so you can see everywhere. There's a positive delta trade a large trade Their impacts in in the market now Some of these trades again are Through a bank desk and I'll touch on this a minute where I'm going to call up say jp morgan on You know equity derivatives desk and say, hey, I want to buy 10,000 amc calls In which case the bank may print their hedge first and I'll show you an example of that in a second Um, and so, you know, you may see the stock move first and then the option print take off again That's information for you though But most of the time in these single stocks, you'll see what are generally options sweep So when algos sweeps all of the options exchanges And then you'll see the stock move as the as the brokers or or market makers need to adjust their exposure So you can see the correlation here You know big option print stock sells A series of option negative delta prints red arrows again stock sells off big inflection point here Big options trade positive delta trade someone's got to buy stock ostensibly to hedge and up the stock goes So you can see that these correlations between again these big options trades big stock volume and a move in the stock So I just mentioned, you know calling a desk I think most of the really big flow in the s&p goes through desks, right? you're going to call up your credit swiss bank america morgan sanley whatever And they're going to put the trade up Where they get their hedge off first and then print the trade, right? That's how they'll tend to do it. So what we'll see here is You notice in the s&p. There's a lot of two two One and two standard evasion trades But this one in particular I want to highlight because you can see the stock volume hits right before the hero signal picks it up in other words real quick Stock print now put the option up right because as the broker wants to get his hedge off before the market knows that a Big trade took place again. The correlation is there between big Option prints and big volume prints in the stock So on this particular move here You'll see that this is where that big stock print went up with the the hero signal Because that hedge went off first You see there's a little tick up first and then the and then the option print takes place But the other interesting trade I mentioned before algos is that You can see it's more likely a sweeper of some kind came in, right? And hit the market with a bunch of a series of Small trades over about five or ten minutes So this trade likely didn't go through a bank desk because it took place in a bunch of small pieces And you can see that took place right at the bottom of this market here So again, here's the red arrow where you see that there's a bunch of negative trades come in and the market sells off pretty hard So why do the market drop here? Well a series of negative delta trades took place It likely had to get hedged out pretty quickly and then you could see right at this 1351 point Which is right at this green arrow the trade suddenly flipped to some bullish sweepers come in and that marks a bottom in the market So that takes place around 1351 which is somewhere in here where you could say You know It's a little bit tougher to pick up because it's not one big trade But if you see it on a cumulative basis Which you pick up on the on the hero cumulative reading you would see these inflection points that take place In the market that can mark big tops and big bottoms One other one I want to check out Not always do are there big trades, you know all day like an amc Sometimes you really just have one or two really big trades and then you know, it's pretty quiet the rest of the day So I know a lot of people like to focus on some of these bitcoin stocks in this case You have m a r a where you have you know one or two really big trades in the day That you know, maybe you want to focus on or pay attention to these other signals are a little bit smaller So, you know, there's a lot of stocks meant to monitor and you'll get one or two big Prince that take place that give you an opportunity to Interact with that options flow or possibly build some trades around it And I highlighted excuse me those trades here. You can see this really big one around noon I mean it corresponds to the minute, you know with a huge bottom in the stock And then a little bit later we have a negative delta trade. Excuse me. We have another positive delta trade Which doesn't create the same volume, right doesn't create the same push But then nothing else really happens and then obviously then we have these other two trades here that I that I highlight Excuse me on the screen. So, you know these patterns show up with different frequency depending on the stock that you're looking at and so That's just a a key thing to note in a key thing to monitor Yeah, as Bruce mentioned before I'm going to show my actual Screen now, excuse me. Sorry But you can go to the bookmark marketplace and sign up not just for the hero indicator But you can also sign up to our we send out two daily notes every single day As well as the on-screen hero indicator we're talking about here So you can subscribe to all of those services through the bookmark marketplace So I'm going to switch over to the Hero indicator itself I'm happy to take any questions on the material. I just presented if you want to ask some questions about the market If if Bruce is okay at that. I'm happy to offer whatever view I may hear I'll just say starting off with what the flow is for today You know, we started the day very neutral as you can see here. There there was a Some bearish options flow to start The readings will quickly get in as you can see here were positive 80 000 on the hero reading right now So there was some bearish minus 20 000 is what we got to on the hero indicator So some you know small light put flow came in and then this is switched to be quite bullish over the day There's clearly one very big trade that took place here positive delta trade and then the trend is working up now so You can see that flow You know come in these dips are getting bought at the moment and the market is staying pretty flat right around this big combo level, which is a combination of spider option positioning and spx is the way called the combo So this is a liquidity center here around this 43 70 and it looks like the the options flow is sort of really centering around That level at the moment Interesting if you want to flip over to some other single stocks too like amc. I mean amc for one is just With the hero indicator, uh, it seems almost, you know Um Like well, I talk about all the time. I'm gonna phrase this a little bit how the how amc is just controlled by options flow I've posted tons of videos about this on my youtube channel. You can check that out Um that you could just see the options flow kick in on this thing and knock it back into place all the time This is a primary example here. You can see right off the top at 43 the options flow just flips very very very bearish You can see there's two big prints here 3k 8k and the stock just slides lower and then you'll see this flow will flatten out and the stock will Regain its footing. Um, so you can see these things will correspond to each other and the options will will lead amc Very consistently Thing that apple uh starts off pretty negative. You can see on this case I have not uh who gotten rid of my on-screen indicator So you can see how overwhelming those on-screen indicators can become So we can just come in here and make a quick adjustment Want to show only things of a certain size And we can do that So there's only been one really big trade and that was a little bit early in the day looks like off the open someone Got a little bit bullish in here and the big option print corresponds with a pretty good lift in the stock So with that, uh, I will take any questions if anyone has and you can put them in the chat I suppose is the best way And if for some reason I didn't get to what you're talking about if you have any questions You can reach us at info at spot game.com. I'm at spot game on twitter Uh, you can get to our youtube channel, which is youtube slash spot game. Um, and I am again happy to take any questions or Uh, we can close it up as I know the the market is pretty busy today Yeah, we got a few questions here and um, also I know that you're putting different metrics together now um But in use case scenarios, uh of the uh hero indicator Sometimes you I mean you you went through a couple where You know the um the cumulative is moving down, but the market is moving up And and and they and then time other times is the opposite How I mean with your options background and knowledge How do you define some of those things and some of that phenomenon because you do define it and you're just saying Okay, this is what's going on. Uh at this point in the market. Yeah Well, there's so there's there's really two ways to to um to kind of put this together, right? So if you think back to that table where I talked about what is a positive delta trade a positive delta trade is if someone's buying calls Right, they're buying call options or they're selling puts If is a negative delta trade it means that they are selling calls or buying puts now I talk about the way to measure implied volatility is just to look at the vix There's a lot of people very sophisticated traders who will probably you know Say that's not the cleanest way but for people who are just getting used to the options market It's a it's a good way on a short term basis to measure that so if people are buying puts They are buying options And that usually means that volatility is going to go up the vix is going to go up So just to tell you what the vix is the vix measures the price of all options that expire within 30 days Of all spx index options that expire within 30 days So if people are buying a bunch of puts because they're scared that the market's going to crash The vix goes up because people are buying puts does that make sense? Yes, okay, so If the hero indicator is going down if it's a negative indicator reading But the vix is not going up Then that's telling me that people are not buying puts right because if they were buying puts the vix will be going up Does that make sense? Yes, so I can therefore into it that traders must be selling calls to generate those negative deltas because Selling calls means they're selling options, which means that that is not going to that's not going to push the vix higher Does that make sense? Yep, very clear So if the market so deltas are going up today, right the the options indicator is going up today The vix is flat to slightly higher If people were buying calls right now Now, obviously this is a little tricky because when you buy calls you're not going to have as much as an impact on the vix Right because people are also going to be selling puts likely at the same time But because the vix is not really dropping very hard and we have positive delta readings I I view that as people are buying calls today and not really selling puts if people are selling puts We'd see a big drop in the vix right now the vix is basically at the high of the day 26 right so If people are going to sell puts then I would say okay, they're they're not scared anymore, right? They're closing up their fear position so to speak But because the deltas are up right this is telling me people are buying calls because the vix is also not dropping If they were selling puts and getting out of their position We'd have positive deltas in other words the hero indicator would be positive But the vix would be getting crushed. Does that make sense? Yes So we have the fomc tomorrow right and the We our view is that because people are worried now is is the fed going to say taper or not and you know I'm not qualified to really opine on any of that here in this in this session But I will just say people are worried right they're concerned that this time the fed is going to say taper or that Evergrande is you know a real calamity this time whatever it may be People are not selling out of their puts Even though vix is pretty flat right in the market is not really doing very much at the moment And so you would expect You know if there was going to be a big rally that volatility i.e. vix would get crushed and then and then you know people Be getting out of their puts as fast as possible because as you know when the market rally is hard and Implied volatility or the vix drops really hard that means put values are getting destroyed Right and it's a race to get out of them as fast as you can to try to save some of your money But in this case vix isn't going down. Yes, we have some positive delta readings But those are I think those are call buyers right so people buying calls is a much different thing from people selling puts It's a total different risk profile Right because you have very defined risk of you're buying a call That's kind of like taking a punt that you think the market's going to go higher, but the people you know if you sell a put Uh, you you have much more risk on the table if the market drops right because you're exposed You're exposed to higher amounts of risk as the market goes down Whereas if you sell a call the most you're going to lose is your is your call premium, right? So I don't know if that was uh, I hope that was a sort of helpful view of what it is I'm looking at I I should definitely Write and do some videos and put some material together You know to elaborate on that but hopefully everyone at least kind of was able to glean some of the ways that I'm looking at this order flow No, that that that was very helpful like a great great scenario there cool, um Let's try to see if there's any other questions in here. What the spot game of main function were correlated with features I'm not entirely sure what that means mark Um mark if you could elaborate on that question that'd be helpful Um, I raise it so a rising hero and rising vixx would mean call buyers, correct? Right. So tim that that is more or less the way to look at it, right? But obviously, you know, um Call buying right as in this case. I'm looking at the vixx the vixx is again at the high And because the hero was up, you know, I think that was just called buyers today So that's exactly how I'll look at that if if the vixx was just getting absolutely annihilated today And we had those positive delta readings that I would say this is likely more a put seller right vol seller rally than it is a Uh, I do not have the nq feed up. So the the hero data is going to be delayed here I can bring it up for a moment So we'll let uh, we'll let the hero indicator get kind of caught up with the market here and then we can take a look at the NAS that Could you use the hero indicator along with the cumulative delta? Yeah, so daniel, you know, I think that there are definitely people who have Messaged me and sent some information about the cvd delta combined with the hero And I think what you can see is that there will be correlations between Uh that cumulative volume delta as well as what you know, what is happening with the Options market. So we're just talking about is it ball sellers, right? Um And is that why we're getting sort of positive cvd along with negative hero readings? And can you kind of put those pieces together? So I think I have not personally done a big study there I know there are several subscribers who do Uh compare those things and have gleaned some information From from uh that information or from those two signals Um, is there a rough minimum daily option volume that we'd use for the hero? So daniel another great question So what we're doing currently is we are storing the live hero reading now in databases So in the next two three weeks, we will be able to start putting out information that tells you Uh, what should measure as a significant trade now for each stock that's going to vary a little bit, right? Because the volume profile of every stock is a little bit different. Um, so we're going to start kind of like Arming people with a little bit more information now Over the next several weeks that I think will clear up sort of what is a big signal or important signal for a stock In what is not like, you know, what you can what you can watch for Um Puneet ass is 67 k is big or small 67 k is pretty decent. Um generally six figures Low six figures is kind of where the the readings get to be their largest So, you know, this is a very big trade here that took place earlier today. That's about uh, let's see. We went from 1800 up to 39 000 so, you know, that is a very large trade Again, I've seen 100 or 200 000 is kind of where the entire thing will will uh, will cap out There will be a recording of this throughout webinar. I believe bruce can confirm that Yes We do not just go a good question. We do not track Options on futures at the moment. So when you're looking at the es call and put flow You are seeing the spx and spy options flow. I've looked at the futures flow. There is Compared to the spx and spy. It's much much smaller flow and it's an entirely different data feed So the the cost uh, is really pretty substantial to just add a little bit onto the signal But it's something that is on the drawing board Do I watch uh hero on the vix or the vvix? So we watch the so if you bring up the vix Futures, you will see the vix options. Um, I hope that answers your question on that, Todd Uh, can I explain on the implications of negative cumulative hero reading for individual stocks? Well, the price is moving up Uh, my view of that is it's so there's two there's two things to really answer here One is figuring out is the flow substantial in a stock in other words We may have just had one or two put traits today, right in in amc. I don't think that's the case for amc Uh, but let's take a look at wish and see what wish is doing so Just for example, you know the float in wish I believe is much smaller the stock float than amc, right? So We may have a negative Hero reading for any given stock, but it may be negative just because only a few trades took place, right? So it's just not material even though it's negative. It's not material So when you have to figure out is it is a big amount of flow that's taking place Um, this will be interesting to talk to watch because as you can see here This is this flow is accelerating to the downside in wish So it's gonna be very interesting to watch what happens to the stock in the next few minutes Um, so you got to kind of contextualize everything, right? Is the hero reading large Which is something that we're kind of giving data to everybody to to sort of help inform you of that Um, and then to you know, what is the direction of that flow? So, um It's possible that there's volatility traders in particularly like big names like apple where there's tons of order flow options order flow Same thing with tesla. I mean, there's likely to be a lot of volatility traders in tesla as well. You know, I mean you look at this You look at this order flow and you know, there's no question about what is going on in tesla right now, right? You know, this delta reading is almost as big as what's going on the es and It's very bearish When you look at this So if this was going up with the stock going down then then you would say that it's possibly a volatility trader, right? Someone short in the stock and buying Uh buying ball. So what I would expect is The market does have a larger drawdown and volatility really spikes. You're probably likely to see a bunch of stocks where The order flow Is positive And maybe that's against a short stock position In other words, maybe I'll sell puts and then short some stock against it as a way to hedge because I just want a short Volatility, right? I don't actually want to be it's not a directional view on the stock. It's a view on the volatility So anytime I see Substantial order flow meaning substantial hero order flow that contradicts the movement of the stock Then I'm thinking that it's probably a volatility trade Uh and not necessarily, you know directional flow and in the implications of those could could be different Uh, it's it's also, you know, let's also be clear on something if traders are shorting a stock, you know, because reddit board said to and A giant fund comes in like on our s and p rebounds date to just buy a stock because they need to own it on their balance sheet Well, then the two signals can conflict for You know reasons that have nothing to do with each other, right? You can have of course situations wherein someone's just a big buyer of the stock And that's irrespective of options order flow, right? So you need to make sure that those correlations are clear and intact Uh and obviously be aware of, you know, are the signals corroborating, right? If we're seeing movements down in here, are we seeing how are we seeing the stock react at the same time? those kinds of things Uh, is the hero showing the next spx resistance as 43 44 today? Right, so let's be clear about two things one the levels that you see on the left are provided from spot gamma the spot gamma service Those are irrespective these levels over here I shouldn't I don't want to say nothing to do this is actually some Synchronization here, but the hero reading Does not link directly to these levels that you see on the left. So our spot gamma service does show support bar at 43 44 Which I believe is Ravi's question this 43 70 area is a big one And then if we scroll up you see there's a concentration of our levels Quite a bit out of the money. So, you know, this is where we would view heavy resistance in the market up around 44 40 area basically if I zoom way out So as we're kind of talking here the The order flow is a little bit possible. What's interesting is the vixx is threatened and kind of break down And I think that would be the fuel if the vixx really kind of breaks back below 25 is where you'd really see that ramp higher on the market What spot gamma main function for futures traders So the spot gamma the main function is support and resistance lines along with volatility estimates That we are calculated from s and p options positioning. So We it's a database analytics of support and resistance lines so whether you're a swing trader or some other type of Trader in futures, uh, everyone uses a level a little bit differently with a lot of option traders that like to use the levels Uh for volatility estimates again, where are the big support and resistance lines? And that's what spot gamma provides on a daily basis Uh, joe asks if there's a correlation between tick and gamma info. I would imagine there is that would be pretty interesting to look at I have not looked at that myself Could you put together a table of what you're saying earlier? Yes, so puny great question. Um, I'd be more than happy to write that down now to put that vixx table together So I got that written down and I'll do that today for sure Is there a way to filter on-screen hero size by standard deviation? There is actually yes. Good question So in the hero indicator here, uh, there's an automatic Filter here. So if you check that you can mark it by standard deviation. So great question there, daniel Uh, and then last question and we'll let everybody head off is why do the cloud notes levels nine up not line up exactly? So the reason is razor great question We All of our data is sourced from the spx index options So as you know, the spx trades at a vig or spread to the actual es futures So 40 to 70 is roughly 12 points equivalent Uh, to what is mapped out on the screen here of I believe 43 58 So that's why you see a difference between the levels. The label is in spx terms But it's mapped on to the futures trading price. So that's why you see a difference there How about the combo level Uh, yeah, so the combo levels the same thing. So what we do for combo is we map We take the spy options and the spx options. We combine those together We back out the spx price and then we adjust the spx price to the futures price So all again all labels are in spx terms. Um, that's a clean way to say it. They're all in spx terms That's what the label is but the print where it is printed on your chart is at the equivalent es price and that's spread Just over time. So by the time the contract rolls that spread is usually about two points You know, in other words our label will only be two points off of the futures features price So, uh, we'll we will leave it at that. We know it's kind of run up to the top of the hour. Um, again, if you have questions Actually, oh, I'm sorry. Um, can you show, um, more information about where I can find videos and your blog and articles? 100% sorry about that. Um We'll flip back to our power point here. So, uh, this is where you can reach us. Excuse me again. Sorry We are at uh spot gamma.com info at spot gamers our email Again, we have a bunch of youtube videos at youtube.com slash spot gamma I do a lot of stuff on twitter as well. If anyone's there, you can catch me at spot gamma on twitter I'm more than happy to try and help answer any of your questions Uh, but we have a lot of resources both on our site And on youtube for anyone who wants to learn more about hero or just in general some of the, uh Different ways that we view market order flow Yeah, maybe can you show your website and and and the blog and and and some of the videos there? Yeah, definitely I mean, there's just such good content on there. So just go to the horse's mouth here basically Yeah, definitely. So this is our this is the spot gamma site. So, uh, when you subscribe to spot gamma, uh, You'll have access to what we call our portal and through there You can get access to just tons of different ways that we analyze the market. For example, um, if you Check out the levels in the s and p 500. We produce gamma based analysis So where are all the biggest options strikes in the market? How do these roll on a daily? On a daily basis, right? So these are these are indications of where the big open interest lies on the markets Many of you are familiar with the concept of gamma, uh, and vana So we produce charts that measure the amount of gamma and vana in the market And then we explain to you every morning what the impact of these different positions are, right? So we don't just say here's what gamma is for the day. We tell you exactly What the impact of that should be in the market We also have a tool called the equity hub which allows you to analyze the Stock the the options position for over 3000 different stocks. So that's the tool that we have on screen here now So you can use this in conjunction with the hero indicator So for example in amc if I bring that up you can see where most of the options are positioned You can see when the bulk of those positions expire And the impact that that has on the stock is Is detailed in our blog. We have tons of different resources on our blog that explain how different traders So many of you may be familiar with dug plus for example He he posted some great charts on here of how he takes advantage of using our different metrics To trade for himself, right? So there's a couple of Of great recent posts from him as well as some other contributors that outline How to use all these tools right how to add them to your existing Trading style, right? I think the key here is we're not trying to offer you a trading style We're not trying to tell you how to trade We're simply saying what is your strategy and you can overlay this options data on top of that, right? Do what you're comfortable with but just consider what the options positions are and make addendums or adjustments to your Existing strategy when these big options levels come into play Okay, and just one more comment like it looks like I didn't want to bypass omar here He was asking for or he had his suggestion to show On-chart on-screen triangle of delta instead of the actual the overall kind of Aggregation I know this in the sub chart but He was he was actually suggesting to see it on chart as well Is that that's what the triangle is I believe is that what he's I thought the the triangle was the individual Transaction Where where that took place Yeah, so so for example here I highlighted only the largest trade so far for the es And so you can scroll back here And this is this is part of why it's so great to have as a book map is they you know You're you save a recording of this data, right and you can zoom in and say what happened here, right? What was that really big trade that we were talking about earlier? And I can zoom in on that and see exactly what the market did at that time All right, you can see that impact, you know right there So I'm not sure if this is what omar is getting at but I believe we I believe book map and The hero indicator can do what he's asking for but please correct me if that's okay Yeah, I was a little confused myself and I wrote him Replied to him there as well, but okay. Yeah Yeah, well that means that we're open to any and all suggestions You know, you can send them over info at spotgamer.com, you know, we love to take feedback and help Consistently and constantly improve our our products All right. Well, thank you very much Brent. Um, uh, you know, uh, dug plus is actually going to be presenting on friday uh, so He's going to be going through some of his hero options And some of the spot gamma levels as well in his strategies So, uh, yeah, everyone you have the The link for I want to mention David Blake as well. Uh, David is a contributor for us I know he's uh, he's active in the book map community. He's posting a lot of great content pieces as well How he uses the the hero indicator and this other pieces of information to trade so, um You know, you can check out his work as well Yeah. Yeah, lots of great stuff from David as well. Uh, he presented last, uh, pro trader webinar and we'll have him We'll have him again though. Um, but, uh, um Yeah, I just wanted to mention that you just see someone else's strategy Uh, uh, you will see Doug on friday. Uh, it's the same link that you use for this webinar hero Just be at friday at 10 a.m. All right. So, yeah, uh, thank you. Thank you very much, uh, uh, Brent and um, Uh, really interesting stuff as always. Uh, and we will have the recording up Later this afternoon probably in about two or three hours Thanks Bruce. I really appreciate the opportunity and I thank everyone for coming on this very volatile day All right. Thank you very much friend. Take care. Bye