 Hello everyone. Welcome to Options with Doug. Streaming live daily on BookMap Discord and the BookMap YouTube channel at 1.30 p.m. 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. Risk disclosure, training futures, equities, and options involve substantial risk of loss and is not suitable for all investors. Past performance is not necessarily indicative of future results. Here's my contact information. The best way to get in touch with me is through Discord. My name on Discord is Doug P. Also on BookMap Discord, there's an options dash Doug chat channel. That's a great place to post questions, comments, and content related to the topics of my presentation and the topics of the channel, which I'll go through in just a moment. I'm also I'm also on X, formerly known as Twitter. My name there is at Doug Plus. The focus of my presentation today and the focus of the options dash Doug chat channel and BookMap 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 market makers, traders and market makers are positioned in 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 a directional bias. And the second step in my process is execution. I look at real-time order flow on BookMap and real-time market maker hedging flow and spot gamma hero to confirm my thesis and for setups for entries and exits. And when I talk about setups today, I will be focusing on an underlying asset and setups in that asset can be taken any number of ways. For example, the S&P 500 setups 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 dash Doug chat channel and BookMap as well as the chat and YouTube for your questions and comments. Please feel free to post and I'll do my best to answer your questions. Alright, here's my agenda for today, Friday, December 15. First of all, I want to go over news items, economic data and events for today to wrap up the week. Then I'll go through my positional analysis. Then I'll review some setups from this from earlier today. And then I'll take a look at the live market. Alright, so first of all, news items, economic data and events. PMI data came out at 945 a.m. Eastern time. The manufacturing PMI data was less than expected, less than previous, also less than 50 indicating contraction. And then the services PMI was greater than expected, greater than the previous, and also greater than 50 indicating expansion. And then of course, today is the big options exploration. And let's just take a look at that. What this chart is showing is delta notional market makers delta notional by expiration. So this is expiration date on the horizontal axis. This is for the USB 500 NASDAQ and also 2000. The orange bars are indicating call delta notional blue bars indicating put delta notional. And you can see the called call delta notional is very dominant, much, much, much larger than the called the put delta notional. And this may be difficult to see. I'm hovering over this bar showing the numbers. And the call delta notional is over 1 trillion. So that's positive 1 trillion. Again, a huge expiration. This is today for the SB 500 NASDAQ and SB 500. So the consequence of this is all of this call delta notional that is helping to stabilize the market is going to be expiring. And that could lead to more volatility next week. Alright, let's take a look at the USB 500 now. This is the ES futures in book map. And one other event. This morning, right around 830. The Fed president, John Williams, was speaking on CNBC. He said that the Fed was not really looking at rate cuts right now, kind of contradicting, contradicting what Jerome Powell said earlier in the week on on Wednesday, the press conference. And there was an initial bearish reaction. That was at 830. And then again, a repeat of that right before the cash open. And that was about 920. Alright, so this is the SB 500 futures. Let me just mention a couple of other things going on today. So first of all, there was a spy dividend. And I posted this in and discord, I usually post the index relationships, including ES to spy the ratio. And that ratio changed pretty substantially from yesterday due to the spy dividend. And also the SB 500 and NASDAQ will rebalance today. So a lot going on today options expiration, SB 500, NASDAQ rebalance spy dividend. Alright, so a lot of a lot of factors moving price up and down today. Alright, let's take a look. Let's start with. So let's start with positional analysis. Now again, this is the SB 500 futures in book map. And before take a closer look at this chart, I want to take a look at larger timeframe. So I'm going to start with SP x and look at a daily chart. And the the reason I'm looking at the daily chart that 3030 day one hour chart that I normally look at has moved past this key turning point, October 30. That was kind of a turning point for the 10 year Treasury yields. Also, an IV collapse put Vanna rally. And now that rally continues some brief consolidation periods. And then this was the November 14 CPR report much better than expected. And then the rally continued. Alright, so quite a move in the in the SP x from around 4100 now trading up over 4700. Alright, let's take a look now at let's go to the 30 day one hour chart, take a closer look at this. Just so we can see the SP x levels. And I'm going to zoom in on this chart. So this is just a closer look at the chart that I just showed the last few days. I'm going to zoom in. So starting last Friday, the SP x brought out broke out of the 4540 to 4600 consolidation, then got a big boost from the FOMC meeting and announcement and press conference. And now it's consolidating somewhere between 4700 and 4750. Alright, let me point out the key levels on this chart. So first of all, the dash purple line showing the lower and upper weekly expected move, SP x trading pretty far above the upper week, weekly expected move. That's based on the options market. I update this once a day, once a week over the weekend. Then the dash blue lines are showing the lower and upper daily expected move. Also based on the options market, SP x trading inside that range today. The dark red lines are showing spot gamma levels. I'm going to point out the key daily levels. These are proprietary spot gamma levels, available to spot gamma subscribers for a variety of trading platforms. This is the this is thinkorswim. Again, I'm going to point out the key little daily levels. First of all, here's the put wall at 4400. That's a strike with the largest net negative gamma that can be expected to act as support. And the next level up is the volatility trigger at 4595 that a spot gammas proprietary volatility flip level. Below that level market makers position on the gamma curve is negative and a negative 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, like SP x trading now 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. The next level up is 4700. That is the absolute gamma strike. That's a strike with the largest absolute negative and positive gamma. So that is where most of the gamma weighted open interest is concentrated. And that may very well change next week. As a lot of that a lot of that gamma expired. And then finally the call wall has moved up to 4750. That's a strike with the largest net positive gamma that can be expected to act as resistance. So that level did move up from 4700 yesterday. And also the volatility trigger moved higher slightly, just 10 points higher to 4595. Alright, so those are the key daily levels. Alright, let's take a look at a shorter timeframe, just to see the levels on play for today. So here's SP x this is a one minute chart. And I'm showing about two and a half days worth of data. This is the reaction on Wednesday from the FOMC announcement and press conference. Very sharp rally higher, and then really consolidation after that. And today this combo l four level at 4724 is acting as resistance. But SP x trading at a very narrow range today. Let's go back to book map now. So in book map, I have my own cloud notes. So I can show SP x levels. There's that 4724 level acting as resistance. Here's the spy 469 volatility trigger earlier today, acting as support. Now it looks like SP x is breaking breaking through that level. So for my with my cloud notes, I can show SP x levels, spy levels, and other any other levels I want on this chart. Note there is a difference in price between ES and SP x. And right now it's today, it's right around 53 points. So what this means ES minus SP x is 53. So I'm showing SP x 4700 at ES 4753. Alright, so again, the levels and play for today, primarily this 4724 combo level. Acting as resistance. And then earlier today, the spy 469 volatility trigger, acting as support. And note again, as I mentioned, that with the spy dividend, the ES to SP x ES to spy ratio change pretty dramatically from yesterday. Alright, so those are the levels and play for today. And for SP x, again, the volatility trigger and call wall shifted higher. And there was a hat trick for spy, the volatility trigger put wall and absolute gamma strike also all shifted higher. So right now, for the SP 500, it is trading below both the spy and SP x call walls at 4750 and 475. So overall bullish shifts higher in the key daily levels for the SP 500. Or let's take a look at NASDAQ now. So earlier today, the NASDAQ has been stronger than the SP 500. Let's take a look at the levels for NASDAQ. So this is the NQ futures and book map. And before I take a closer look at this chart, I do want to isolate first the QQQ levels. QQQ here is 405. Yesterday, that was the call wall. And today, the call wall has moved down to 400. So 400 for QQQ, that is the call wall and the absolute gamma strike. Or let's take a look at NDX and note this 406 level, more or less acting as resistance. I'm not sure what you would call this pattern kind of a double head and shoulders. Let's take a look at NDX now. See the NDX levels and play for today. So also a pretty narrow range for for NDX with the 16600 level in play. That's an L one level on this combo L one level combining QQQ and NDX gamma weighted open interest into one one level. And that is 16604. Let's go back to book map in Q futures. Here's that cluster of levels right in the middle of the price range. Point of control just below that. So that is NDX levels and the QQQ 405 level. So just like yes, I have my own cloud notes so I can show QQQ levels, NDX levels, also key levels for for NQ. There's the upper daily expected move for NQ today, acting as resistance. So NQ moves up to that level. And as you would expect moves lower at that upper daily expected moves staying within that range. And we'll take a look at setups in a few minutes. And Sheena 205. Hello, welcome. Glad you're here. Ask if I can please mark the call walls with a box or question mark since I don't read the numbers clearly or always follow your, follow your pointer. Alright, so the call wall, call walls are not visible on on either chart today. So for yes, I don't know it may I'm looking at YouTube I can read, I can read these numbers. So for example, here's the 469 volatility volatility trigger. I don't know I can read that okay. Alright, so I hope that helps. Sheena, how's the point of control determined? That is in that's just something the book map does automatically. It's volume point of control. So does the where most of the volume session volume is concentrated. He just this is the session volume profile. And I'm showing the point of control on chart. If you want more information that on that, just go to the book map website, and look for the knowledge base, and you can search for point of control. And you should be able to get more information. But it's based on the session session volume profile. And I start my session at actually, I have backfill data so I can get backfill data all the way to the start yesterday afternoon. So that is the 6pm start of the futures yesterday. So that's what my session is based on. But of course, most of the volume is concentrated here in the regular trading hour session. Alright, Adam asked, how can you see when we get a short squeeze? And when it's going to end like right now on NQ? Alright, let's go back to NQ. Well, the way I look at this is looking at the stop orders that show my the yellow line on the sub chart. This is in some mode or cumulative mode. So this is showing that his price was increasing by stop orders were helping to fuel the move higher shown by that rising yellow line. Also the on chart indicators, these are showing by stop orders that helps to fuel the move higher. And notice this stop orders start to reverse and move lower as NQ reaches the upper daily expected move and now sell stop orders, helping to fuel the move lower. And when is it going to end like right now on NQ? So for NQ, I would look for if you're looking for some clues right now. One thing to look at is iceberg orders, large traders coming in with iceberg orders buying with iceberg orders. On the other hand, yellow line sell stop orders continue to move lower. Also aggressive sellers moving lower. And of course, I always look at at heroes. So let's do that now. Let's take a look at some setups. Actually, before I do that, let's I didn't have not finished my positional analysis. I do want to take a look at gamma notional to see how market makers were positioned on the gamma curve at the beginning of the day. And then Adam will get two setups and NASDAQ in just a minute. Alright, so this is gamma notional market makers position on the gamma curve at the beginning of the day. And the reason I look at this is gives me a sense of potential volatility for the day and how market makers may may react with changes in price and applied volatility. This is for the SB 500 NASDAQ and also 2000. Note all these numbers are positive. So for an index, what that means is this is spot gamut assumption that traders are short calls market makers along calls, and they have to sell futures to hedge their delta exposure as price increases, and they can buy them back as price decreases. So they're trading against price action and positive gamma environment. Note these numbers did shift around from yesterday for the SB 500, although they're still quite positive. They did shift lower less positive. And for QQQ, gamma notional also shifted lower, as well as IWM still positive, but less positive. So that is that trend is most likely to continue with expiration today. Let's take a look at Vanta model to get a graphical representation of what that may mean. I'm going to start with the Vanta model for SPX. What this chart is showing is market makers delta notional. That's their delta exposure on the vertical axis and price spot price for SPX on the horizontal axis. There are two curves on this chart. The first the light gray curve shows how market makers delta notional may change with changes in price only. And the purple curve adds implied volatility to the equation. That shows how market makers delta notional may change with changes in price and implied volatility. And that change in delta with the change in implied volatility is the Vanta effect. Vanta is a second order Greek. All right, let's take a look at price now. First of all for SPX, currently trading right around 4706. So starting to shift toward this left portion of the curve. So what this is showing if price continues to fall implied volatility increases, market makers will need to sell futures to hedge their delta exposure. So gamma is shifting in this case from positive to less positive to even potentially negative. So on this portion of the Vanta curve, market makers will need to sell futures as price drops to hedge their delta exposure. And that that can enhance or increase volatility. On the other hand, price started to increase up toward 4800 that market makers would need to sell futures to hedge their delta exposure. And that would be gamma becoming more positive. Or let's take a look at spy spy currently trading right around 468 469. So also moving toward the left portion of this Vanta bottle, I'm looking at the purple curve. That's the one that I take a look at. Finally, let's take a look at QQQQ. Still positive for the day. Trading right around 404. Little bit closer to the bottom of the Vanta model here. Alright, so let's take a look now at some setups. So that was positional analysis. Now we'll go take a look at some setups. And I'm going to start by taking a look at what options traders are doing today. So this is the this is spot gamma hero. And this is showing options trades and market maker hedging activity. This is real time data. Hero stands for hedging impact real time options. Everything that we've looked at so far, other than book map has been based on static data, open interest that is updated once a day, sometime during the night by OCC. Spot gamma takes that data applies their own proprietary algorithms. They come up with the levels that that we've looked at the Vanta model, everything that I use in my planning process, my positional analysis. Now this is real time data. So this is showing again price with a white line, hero signal with a purple line price, hero signal, and hero signal is showing options trades and market maker hedging activity for a combined signal of SPX spy, XSP and ES futures on the one combined signal. And a rising purple line indicates traders are taking positive delta positions. They are buying cause and or selling puts and a falling purple line indicates they are taking negative delta positions, buying puts and or selling calls. So I'm going to zoom in on this chart. This right here is the cash open 930 am Eastern time. And just about 10 minutes after the cash open, note the rise in the hero line traders started taking positive delta positions. Price increases, hero line levels off and price consolidates, then traders start taking negative delta positions and price starts to move lower. Very strong correlation between options trades hedging flow and price action in the SP 500. So when traders buy and sell calls and puts and the spy SPX ES market makers take the opposite side of those trades, and they hedge their delta with futures with the ES futures. And let's just take a look at Excuse me, let's take a look at calls and puts see what traders are doing. So first, first of all focusing on the morning, traders were buying calls and selling puts. So that's shown by the rising orange line calls, they're buying calls, rising blue line shows they were selling puts. So when both of these lines move in the same direction, that's a very powerful directional signal. And right around 1015, they start stop selling puts, kind of giving an early warning to consolidation. Then around 11, they start stop buying calls, they take their foot off the gas, and then right at 1230, they start selling calls and buying puts, price moves lower. Alright, so let's go take a look at book map. Now, go back to ES. So here's the bump up these volume dots just a little bit. Here's the cash open. And the magenta, the volume dots are showing market buy minus sell. So right at the open, there were a lot of aggressive, aggressive sellers, market sell orders, green dots. So the volume dots again show market buy minus sell, magenta dots indicate more sellers than buyers, and green dots indicate more buyers than sellers. So price moves down to the 469 volatility trigger, and note the large iceberg orders here, that's shown by the on chart indicator as well as the rising light blue line in the sub chart. And at this level of zoom, spot gamma consolidates a number of trades, executions, and the one big number that is 5,566 contracts, and 52 different executions. Nevertheless, that is a large number, a lot of iceberg orders that trade large traders used to hide their size. So that's one indication of a potential reversal. So that we know that price was dropping down to a potential support level. Large traders start to come in with iceberg orders. We also know that from hero traders were buying calls and selling puts, market makers take the other side of that. So they have to buy futures to hedge their delta exposure. And that leads to a rally from 469 all the way up past the spy 470 level up to the this 4724 combo four level that did act as resistance. So long period of consolidation, about 90 minutes. Then as hero turns lower, traders start selling puts, selling calls and buying puts aggressive sellers start to come in and price moves lower. Alright, so not a lot of range in the ES today. Gamma Gamma market makers position on the gamma curve is still positive positive gamma environment tends to lead toward more mean reverting price action. So let's go back and take a look at hero now and see what what traders are doing. So still hero is trending lower. We'll keep an eye on that. Let's take a look at NASDAQ now. So in the morning, starting around 950, hero was trending higher supportive of a move higher. Right around 1040 1050 11 o'clock, hero levels off. And then before the excuse me, before the SMB 500 turns down, the hero signal for NASDAQ turns down. So let's go take a look at book map. And let's just take a look at one other thing puts and calls. So traders have pretty much continuously been buying puts that shown by the falling blue line. And in the morning, they were buying calls. Now it looks like they have resumed buying calls again, or right around 1250. Let's go take a look at book map, go to NASDAQ. And again, earlier today, NASDAQ was much stronger than the SB 500. And here's that move higher at 930, aggressive buyers start to come in. Also buy iceberg orders shown by the rising light blue line. I'm not sure why the on chart indicators not showing that it is showing the cell iceberg orders later on. So that looks like just like the SMB 500 a pretty large order by iceberg orders. So we know that traders were taking positive delta positions, price moves up all the way to the upper day they expected move. I don't know what what's going on here with. Let's just move on go back to ES if we can get that cleared up back to NASDAQ. Alright, there we go. Sorry about my voice today. Alright, let's go back and take a look at hero again. One other signal that I like to take a look at so hero signal for NASDAQ still negative notional value for today. But moving up off the lows, take a look at the mag seven. Let me zoom out. What this chart is showing is options trades and market maker hedging activity for a combined signal for the stocks known as the magnificent seven Apple, Amazon, Google, Meta, Microsoft, Nvidia, Tesla, these stocks make up a large, large portion of the both the NASDAQ 100 and the SB 500, but especially the NASDAQ 100. And that may change a little bit with with the rebalance that may be one explanation for the recent weakness. But anyway, today they are definitely taking positive delta positions. Traders taking positive delta positions in the magnificent seven. We'll take a look at an example of several of those stocks in just a minute. Let's just do a quick separation puts and calls. So they're buying calls today. So the notional value of calls. That's one billion. Versus they're also buying puts. That's minus negative minus 90 91 million. So call buyers much, much more aggressive than put buyers and call when traders buy calls, market maker sell the calls, and they have to buy whatever stock they're buying calls in to hedge their delta exposure. And we'll see that again in a couple of examples. So this is another very valuable indicator to look at, especially for the NASDAQ, but also the SB 500. So in the morning, sorry about that, spot gamma is still working on this issue. So in the morning, traders taking positive delta positions buying calls, options traders take their foot off the gas, price levels off. Let's take a look at some stocks now. And I have been focusing most of my attention, most of my trading on stocks recently. So let's take a look at several stocks. From this morning, there's Amazon, very strong warning and Amazon. Notice 150 is the call wall key gamma strike. Traders, just a couple of minutes, five minutes after the open, start taking positive delta positions that show by the sharply increasing hero signal. Also note the flow alert there indicating significant options activity. Let's see what they're doing. So in the morning, they were buying calls. Again, when trade market maker when traders buy calls, market maker sell the calls, and they have to buy stock to hedge their delta exposure. Sorry about that. Zoom back out. So notice how as Amazon reaches the 150 call wall level, that the options traders take their foot off the gas, and then start taking negative delta positions. And sorry about that. Again, let's go take a look at book map, go to Amazon. The reason the volume dots were so big is for some reason today, I guess maybe the expiration that the all the stocks, the opening print compared to the volume at the rest of the day is huge. That's the opening print. Show them what that huge volume dot. So here's the 150 call wall, doing its job, acting as resistance. So I'm a john Amazon jumps up very quickly. Two points up to the 150 call wall options traders take their foot off the gas, and price is now consolidating moves a little bit lower. Now consolidating. Alright, the next is meta, also a huge opening print. There it is. And depending on the closing print, the point of control will certainly remain at that level of the opening print. That's where most of the volume was today. Let's go take a look at hero, see what options traders were doing in meta, and very similar to Amazon. price for meta did not make it to the call wall at 340 traders aggressively buying calls at the open note the flow alert, again, sign, signaling, significant options activity, call buyers take the foot off the gas, price consolidates, they start selling calls, price moves lower. Also another dynamic and play for today is the expiration. A lot of these stocks that I'm looking at, their options are call dominated, especially for meta would be above that call wall, and as price and those are a lot of calls that expire today. Price moves lower, traders stop buying calls, all those calls that are out of the money quickly lose value due to the passage of time, that's charm, the chain and Delta is decreasing. So the change in Delta as time passes, that's a charm effect. When traders buy calls, market makers sell the calls. And as those calls start to lose value, market makers can sell their long stock edges. So that's a call gamma unwind. Or let's go take a look at book map. So again, there's the sharp rally right at the open with the huge opening print. And then options traders take their foot off the gas price consolidates. Or the next one I want to take a look at is Nvidia. Very strong day here at Nvidia. Again, a huge opening print. Let's go take a look at hero. See what options traders were doing. Go to Nvidia. Same pattern. Traders aggressively taking positive Delta positions from the open. Take their foot off the gas price consolidates, removes lower in this case, consolidates. Now it looks like they have started taking positive Delta positions again. And when I looked at this earlier, they were buying calls and selling puts. Calls shown by the rising orange line, positive notional value. They're also selling puts. Most of that activity was in the in the first hour of trade, then they took their foot off the gas now maybe buying puts. But overall for the day, notional value still is positive. So they are buying calls and selling puts and Nvidia. Alright, so good day in Nvidia. If you're bullish, let's go back to book map. Let's zoom in on this a little bit. And unlike meta and Amazon, it looks like there were more, more opportunities to get long. Deep pullback right around 945 price moves up to the high liquidity at 490. The heat map and book map shows a history of the limit orders resting orders in the order book. Limit orders above price would be sell orders. And those orders are consumed. Price pulls back a point to 489 and continues higher, then makes a series of higher lows. So multiple pullback pullback entry opportunities in Nvidia, and certainly the typical range in Nvidia is much, much greater than Amazon, especially. Let's go back and take a look at a hero. Let's take a look at one other thing. This is equity hub. And let's take a look at Nvidia. We can take a look at some information in here. So first of all, there's a considerable amount of gamma expiring today, almost 49% expiring today. And note, the composite view chart here shows in the green area that options are dominated call options dominate options above the 485 strike. And a lot of that is expiring today. So if creators were not buying calls, market makers would most likely be selling stock to hedge their delta exposures, their delta decreases due to the passage of time, those calls losing delta as due to the charm effect. But in this case, they are buying calls that hero shows their buying calls. So market makers have to continue to buy stock to hedge their delta exposure. Let's just take a look at the history. And what I like to look at is the changes and the key daily levels. From yesterday to today. So there were no changes. But the call wall does remain at 500. So up above for for Nvidia, there is room to run. So that's the potential ceiling for Nvidia at at 500. Let's go back to book map. So traders continue to buy calls and and sell puts. Right around 130, they started buying puts. But overall, notional value is still positive. Let's go back to book map. Alright, does anyone have any stocks they want me to take a look at? Now's the time. Alright, let's circle back and take a look at the first of all the SB 500. So the SB 500 DS futures stuck just below the spy 469 volatility trigger. Take a look at NASDAQ. And so NASDAQ just now below the NDX 16,600 level that has acted as resistance, then support, support, now potentially resistance. Let's take a look at hero and see what options traders are doing in the indices also the magnificent seven. Then we'll call it a day. Alright, so first of all, the SB 500 options traders continue to take negative delta positions. Market makers take the opposite side of that have to sell ES futures mag seven positive delta in the morning, foot off the gas, and now starting to take negative delta positions. And finally NASDAQ. And sorry, I'm sure I'm going to butcher your name. I'm not sure how to pronounce that. Lodudas says thanks constant consistent clarity. Thank you for your kind words. You're very welcome glad you're here. Alright, so with the NASDAQ hero is slightly trending lower maybe maybe leveling off now. Let's go back to book map. Yes, still struggling to make it above the 469 volatility trigger. Okay, my time is up. I want to thank everyone for watching. Thank you for your questions and comments. I was hope I was able to answer everything. Everyone have a great weekend. And I will see you on Monday. Thanks again. Bye