 Hello everyone welcome to options with Doug streaming live daily on the book map discord you on book map discord and the book map YouTube channel at 1 30 p.m. Eastern time before I get started I need to go through the disclosures general disclosure all book map limited materials information and presentations are for educational purposes only and should not be considered specific investment advice nor recommendations risk disclosure trading futures equities and options involves substantial risk of loss and is not suitable for all investors past performance is not necessarily indicative of future results the focus of my presentation and the focus of the options dash Doug chat channel and discord is options order flow the impact of options markets on stocks and futures and the influence of market maker hedging flow on price action I'm a two-step process for trading and the first is planning and I use positional analysis I look at how traders and market makers are positioned 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 of my process is execution and I look at real-time order flow and book map and real-time market major hedging flow and spot gamma hero to confirm my thesis and for setups for entries and exits and just to be clear when I talk about setups I will be talking about an underlying asset and my analysis of that asset is based on these items I just mentioned based on the options market and order flow positional analysis order flow and book map and market maker hedging flow and spot gamma hero and those setups can be taken any number of ways with futures shares of stock or options questions and comments are welcome and I will be watching the options dash Doug chat channel and discord and the chat and YouTube for your questions and comments so please feel free to post your questions and comments my agenda for today I'm going to talk about news items upcoming economic data and events for the week then I'll go through my positional analysis for the S&P 500 and the NASDAQ and then I'll review some setups from this morning and then I will talk about the live market alright let's get started first of all news items for this week there are there a variety of smaller items I think the primary is the apparently Fed chair Jerome Powell will be testifying before Congress on Wednesday the 21st and Thursday the 22nd at 10 a.m. each day so that should should be a market mover anytime Powell speaks it normally is and again there's a variety of other smaller items and it looks like quite a bit of Fed speakers coming out for the rest of the week during the week one other thing I want to point out and I posted this in discord is that spot gamma will be hosting a small mini boot camp next week next Wednesday June 28th 10 a.m. to 12 p.m. Eastern time you can sign up here again I put the link in discord and I will be presenting two case studies for Nvidia and Google so the focus will be on tech and AI stocks alright let's get started let's take a look some charts I'll start my positional analysis now so this is the S&P 500 in book map this is the S&P 500 futures for today and before I dig into this chart I want to take a look at a couple of other charts just to larger time frame so first here is the SPX this is a one-day chart going back to around mid-March so what this is showing is how the SPX has reacted at various expirations and this may be hard to see this red line these red vertical lines here are showing the major monthly expirations so there's the March expiration April May and June and the thing to point out is how the market has reacted just for a few days after expiration notice the pullbacks on or around expiration for the last last three months and one thing to note is right around here is when the SPX gamma notional market makers position on the gamma curve shifted from negative to positive so in a positive gamma environment these markets are typically call dominated and this the way this works or is expected to work is traders are buying calls market makers are selling calls and they have to buy futures to hedge their delta exposure and then at expiration all those calls the big call dominated expiration like certainly this June was definitely call dominated and those calls go away and market makers can sell some of their long hedges and that was just the opposite dynamic of last year in a negative gamma environment where traders with long puts market makers were short puts and at expiration those puts would go away and market makers could buy back their short hedges so this is just an opposite dynamic from last year and a last year was a put dominated market for the most part and to this year so far beginning around the beginning of April a call dominated market and that was especially true for the the June expiration alright so that that's what set my expectation for today and and maybe this week alright so that is a one-day charting this is showing thinkorswim one-day chart for SPX and then let's zoom in just a little bit and take a look at a a 30-day chart whoops I've got the wrong chart here sorry we'll get to that one in a minute so this is a 30-day one-hour chart showing the steady uptrend in SPX that began around the 40 4100 level and that was toward the end of May and now let me point out some levels on this chart first of all this is the lower and upper edge the expected move for the week this is based on the options market and remember last week that SPX traded massively well above its upper weekly expected move and so far today SPX is treating above the lower and below the upper weekly expected move and then this dash blue line is the lower and upper edge the expected move for the day and note SPX did trade below that level and now is trading above the lower daily expected move let me point out some spot gamma levels now so this is a thinkorswim chart and I have a script from spot gamma that is provided to spot gamma subscribers and I'm going to point out some key levels here so first of all here's the put wall that is the strike with the largest net negative gamma that can be expected to act as support and that's at 4,000 it has remained at that that level for some time out of play the next level is the volatility trigger at 4295 and then a spot gamma is proprietary gamma flip level below that level market makers position on the gamma curve is negative in a negative gamma environment market makers have to trade with price to hedge their delta exposure and that tends to enhance or increase volatility on the other hand above that level like SPX is trading right now market makers position on the gamma curve is positive in a positive gamma environment they have to trade against price to hedge their delta exposure and that tends to subdue volatility and then the absolute gamma strike is at 4,400 and that's right here that's a key level a lot of gamma concentrated that level the absolute gamma strike is the strike with the largest absolute gamma and spot gammas was saying in the AM founders note that they are looking for are looking for a bearish situation below 4,400 and bullish above so that's their bias bearish below 4,400 and bullish above and that is a again a large large gamma strike the absolute gamma strike and then finally the call wall at 4,500 that's the strike with the largest net positive gamma and that can be expected to act as resistance and note that level did increase from last week it was 4,425 on Friday and it increased to 4,500 today after the expiration so those of the lower those of the weekly daily and weekly expected moves and then the primary key daily levels from spot gamma so for again for SPX call wall did shift higher and for spy the the volatility trigger shifted higher put wall shifted higher and the call wall actually shifted lower from 450 to 4,400 so mixed picture for the S&P 500 all right let's take a look at one other thinkorswim chart so I'm going to zoom in even more and go to a one day one minute chart just to focus on the levels that are in play for today so here is the lower daily expected move and note now SPX is trading above that level and then here's the 4,400 level that has acted as resistance just after the cash open and then just a few minutes ago so if that level does act as resistance another level to look for down below is the this dash purple line here showing the JP Morgan collar strike and these that is expires at the end of June and that is a a key level that has often been in play in prior expiration so this is a major gamma level JP Morgan short call in the JP Morgan collar at 4,320 and that has the JP Morgan collar strike has often been a good level for pinning at expiration and again that expires at the end of June so that would be the the end of next week all right so those are the levels that are in play for the S&P 500 let's take a look at NASDAQ now and actually let before I do that list while I'm on book map here let me point out some levels here so I have my own cloud notes here and I've got SPX levels SPI levels and other levels as well so this is for example up here is the 43 439 SPI 4 to 39 put wall and prices trading below that then here's the SPX 4400 absolute gamma strike that has acted as resistance this is the lower daily expected move for ES it's a little bit different than SPX and then here's the SPI 435 large gamma three level that did act as support earlier today so on my cloud notes I've got a combination of levels I'm looking at SPX SPI and also the expected moves so those are the levels are in play for today for the S&P 500 let's take a look at NASDAQ now and we'll take a look at setups in a few minutes we'll take a look at setups in a few minutes alright so for NASDAQ levels in play first of all let's take a look at a QQQ chart and showing the levels that are in play that have been in play so far today and this is the 368 volatility trigger that acted as resistance earlier today and now the NASDAQ QQQ is heading up toward that level again and then the 364 level acted as support I know there's a direct relationship between QQQ and NQ and right now I have the NQ slash QQQ ratio at about 41.56 so I use that ratio and also just to point out the call wall up above at 370 and for the NASDAQ NDX volatility trigger put wall call wall and absolute gamma strike all shifted higher so that's bullish and then for QQQ the volatility trigger shifted higher but the call wall shifted lower right so here's NASDAQ and note the resistance early in the morning at this cluster of levels here that is the NDX 15,125,129 the QQQ 368 volatility trigger and then the NQ 15,300 all acted as resistance and then here's the QQQ 364 level that it did act as support so those are the levels that are in play for the NASDAQ note here the NDX put wall at 15,000 pretty close to the lower daily expected move and price did shoot below that but now is trading back above the the put wall and the lower daily expected move right so there's a NASDAQ levels and I talked about shifts and levels for the SPX by NDX and QQQ let's take a look at a couple of other items that I use in my positional analysis first of all this is the Vana model for SPX I like to look at this every day what this chart is showing is how market makers delta notional changes that's shown on the horizontal axis with changes in price and that's shown on the vertical act of the horizontal axis so delta notional on the vertical axis price shown on the horizontal axis there are two curves on this chart the first the gray curve is showing how market makers delta notional will change with changes in price only so what this is showing is if price increases market makers will need to sell futures to hedge their delta exposure and that is typical of a positive gamma environment and then this purple curve adds implied volatility to the equation so that's showing how market makers delta notional will change with changes in price and implied volatility and that change in delta with the change in applied volatility is the Vana effect hence the name of this chart the Vana model what this is showing is price increases market makers may have slightly less delta notional to hedge as price increases on the other hand as price decreases they will have significantly more delta notional to hedge so as price decreases and implied volatility increases they will need to sell futures to hedge their delta exposure all right let's see where the SPX is trading right now give me just a moment so I have SPX at forty three ninety seven just below the forty four hundred level so that's right here so what this is showing is from this level if price increases there may be a slight tailwind as market makers can buy back some short hedges and then as price continues to increase market makers will need to start more aggressively selling futures on the other hand as price decreases market makers will need to sell futures to hedge their delta exposure and that would be a typical of a negative gamma environment all right let's take a look at one last thing and this is what I'm going to look at here is the market makers gamma notional position on the gamma curve for SPX, SPY, NDX and QQQ and note for SPX it is still positive and that actually increased slightly from last week from Friday and then on the other hand it market makers position on the gamma curve shifted lower for SPY NDX and QQQ and now is shifted from positive negative for SPY shifted slightly less positive for NDX typically not a factor there and then shifted slightly more negative for QQQ it's kind of a mixed picture there for gamma notional all right let's so my thesis for the day was really looking for shorts why I was looking at the the past pattern in a call dominated market let me just point out what I was what I'm talking about with a call dominated market so this is showing the expiration concentration delta notional and it's still showing the this is the expiration from last Friday this chart is still showing that and note the orange bar is showing positive delta or call delta and the blue bar below is showing put delta so this was definitely definitely a call dominated market and again the dynamic in this type of market is that market makers can sell some of their long hedges as those calls go away all right so that was my thesis for the day now let's take a look at some setups we'll go back to the S&P 500 and second wins hello he says would you check net netflix yeah we we can do that when I get to the live market now I do not have Netflix in book map but we can take a look at it in in hero spot gamma hero all right so the setup that I want to talk about is the short setup in the morning so let's take a look first at spot gamma hero and a little bit of a confusing picture here this morning not not clear anyway what this chart is showing is price for SPX and the hero signal this is hedging impact real-time options showing options trades for a combined signal for SPX spy XSP and ES futures into one combined signal so it shows showing options trades and market maker hedging flow so a sloping line down indicates negative delta positions and that is what is shown here by this total notional value there right now at minus 1.2 billion so for the day options traders are net taking negative delta positions in SPX spy XSP and ES futures let's take a look at the individual components for that and then we'll take a closer look at this chart so first of all SPX notional value for today so far are slightly positive at one round 170 million right now positive 170 million spy definitely negative at 1.5 billion negative 1.5 billion and ES futures also negative and showing a very strong correlation between hedging flow and price action for futures at minus 123 million now alright so let's go take a look at the total signal going to zoom in on this chart and right at the open here take a look this was a confirmation of the short note that heroes started making lower highs as price dropped and initially that was that was for the first 45 minutes to an hour helping to set up the short let's just take a look and see what what traders were doing first of all we can separate out puts and calls so actually they were buying calls and buying puts and up until about 11 a.m. the call buyers were more aggressive than the put buyers that numbers larger positive 830 million versus minus 286 million but price was moving lower all right let's go back to the total signal now let's take a look at the zero DTE trades and this the purple line is showing all expirations and then the kind of the green or light green line is showing just trades that expire today again for SPX spy and ES so it looks like zero DTE trades are driving a great bit of the order flow today or at least they were this morning all right so this supported a short first thing in the morning and know that traders did start fading the move or around 1020 1025 so let's go back and take a look at book map so here's the short setup with try price trading below the 4400 level and this was kind of spot gamma's pivot level looking for leaning bearish below that level and bullish above so price failed to move above that level and then the spy 438 level did act as resistance price made a slightly lower high made another lower high and then this is interesting accelerated below that lower daily expected move shown here with light blue dash line and note that larger traders were fading this with the with their iceberg orders they were selling it with large iceberg orders they used to hide their size and note that cumulative volume delta and stop orders were also moving lower so there's the short setup in the SAP 500 and SAP 500 found support at the spy 435 large gamma 3 level all right so that's the SAP 500 short setup from this morning remember I'm reviewing setups from the morning and I will we'll talk about the live market in a few minutes all right so let's take a look at NASDAQ now and this was a I thought a pretty clear setup short setup in the morning we'll zoom in on that let's go take a look at hero for NASDAQ and this is a combined signal for NDX and QQQ I'm going to zoom in on the morning session and this was a very clear divergent setup note that just after the open around 935 options trade start options traders start taking negative delta positions NASDAQ continues higher up to that cluster of levels again remember the QQQ volatility trigger at 368 the end in DX levels around 15,125 and then the NQ 15,300 level all clustered in that level acting as resistance and price reverses lower at that level let's go take a look at book map again so there's the short setup in NASDAQ and note the shift in order flow here the green dots aggressive buyers up to this level that you would anticipate to act as resistance and it did and then the shift in order flow a lot of aggressive sellers shown by the pink dots start coming in and move price lower and then price moves lower as sell stop orders and aggressive sellers shown by the cumulative volume delta start to move price lower alright so that was the short setup in NASDAQ let's take a look at a couple of others and I'm just showing a few examples from this morning so here's AMD we'll take a look at hero for AMD assuming on this so this was a pretty clear signal this morning this divergent setup note hero falls and note this vertical line and the hero signal that is a that's a sign of a larger large trade large institutional trader and they were buying puts so actually this is showing several several tranches here buying puts buying puts and then selling calls so negative delta positions there in an AMD setting up a short 120 is the key gamma strike let's go back and take a look at book map so the reversal lower actually happens around 120 150 and price targets at 119 118 and then a price continues lower at 117 116 and maybe even 115 alright so that's AMD the next Microsoft and another good short set up this morning look at Microsoft and this one was not quite as clear as AMD but price started to level off as soon as options traders stopped taking positive delta positions started to move lower and hero moved lower just a few minutes later let's go take a look at book map so there's the short setup in Microsoft reversal lower 342 341 340 and even 339 so several good short setups there in Microsoft all right the next one is Nvidia and there was a good short setup this morning and now it looks like the dip buyers could not resist Nvidia zoom in on the morning and this is when I'm looking at this so this was a short setup this morning not a clear divergent setup like AMD let's zoom out so then let's just see what traders are doing so they've actually been selling puts steadily oh since about 1030 started selling puts that shown by this rising blue line and then they started buying calls around 1230 1220 1230 alright so so far I thought the clear signal by far was the NASDAQ this morning alright there's a second winds asked to look at Netflix so here it is very strong correlation between hedging flow and price action found resistance at the 440 key gamma strike it looks like in the early morning session primarily calls were driving I'm looking at the though the first hour hour and a half of trade calls are shown with this orange line so initially they were buying calls traders are buying calls when traders buy calls market makers sell the calls they have to buy stock to hedge their delta exposure and then when price starts to fall they can they can sell those hedges alright so there's Netflix let's just zoom out and see so that is the the day so far for nas Netflix bet us the best setup was the reversal lower at the key gamma strike as options traders started taking negative delta positions so there you go second wins right now it says very interesting to see the overview spx these past couple months great analysis thank you very much thanks for your kind words all right let's take a look at the live market and again if anybody has any other stocks that you want me to take a look at I will be glad to do that so let's go to the live market now and you welcome second wins he says thanks for the analysis right so here's the S&P 500 and note just around 1045 1050 this hero line has definitely shifted to negative delta right now at minus 1.75 billion and it looks like finally the S&P 500 may be rolling over and responding to these options traders sometimes it takes quite a while zoom out to this level so around the level that acted as resistance before let's go take a look at book map and go back to the S&P 500 and second wins says I really got to get have to get spot gamma is there a discount for spot gamma users no I'm sorry as far as I know there are no no discount codes or coupons although spot gamma typically offers a free seven-day trial and occasionally I've seen them offer like a two week or maybe even a one month trial so again right now as far as I know no coupon codes no discount but free seven-day trial all right let's take a look let's zoom in on this so we know that options traders have been taking negative delta positions all day or actually since around 1045 1050 something like that and note this line I'm showing icebergs and stop orders in some mode in my subchart and note this light blue line showing icebergs orders has been gradually decreasing all day larger traders are selling selling this move gradually with iceberg orders and I opened book map around 7 a.m. Eastern time so that's when my mbo data market by old market by order data starts and that's when the icebergs and stops start accumulating although there's no significant volume until the cash open but anyway both all three are negative today icebergs stops and cumulative volume Delta and especially stops stop orders large traders again using iceberg orders to hide their size and the s S&P 500 found resistance right at this 4400 level and again that a spot gammas pivot level leaning bullish bearish bias a bearish bias below that level and bullish above zoom in on this just a little bit more and note that price did make a series of lower highs first short set up at the 4400 level and that is about I've got a 43.5 point difference between ES and SPX so that would be 44 43.5 in ES all right there's some requests for stocks right so karma FX wants to take a look at Baba Ali Baba so I again I don't have that in book map we can take a look at that in spot gamma and I just have my watch list below so I'll look for Baba up here so karma FX there you go there's Baba very strong correlation between options trades hedging flow and price action and in the morning session it looks like call sellers were driving price action up until about noon all right so the second winds ask for Boeing let's take a look at that and again very strong correlation between options trades hedging flow and price action and calls driving traders have been buying puts and selling calls call sellers more aggressive and there seems to be more strong of correlation between the calls and price action so nice move down and Boeing from around 219 at the open down training around 212 it looks like so Boeing move from actually just below the key gamma strike down to the hedgewall at 212 and karma FX and second winds you're welcome glad I can help so stocks often are much simpler to look at and analyze if you're using if you're using hero here there's often for many stocks a very strong correlation between options trades hedging flow and price action so a lot less information here than than the S&B 500 for example where I'm looking at stops and iceberg orders and Kimley to volume Delta a lot of things stocks are much simpler to look at well let's take a look at NASDAQ so NASDAQ unlike the S&B 500 options traders continue to take overall when we look at the total cumulative signal for the day still positive Delta notional notice that the hero line has flattened out a little bit slightly sloping down let's take a look at a shorter rolling window I'm going to look at the last 30 minutes of data and that is also pretty flat not giving much clarity so instead of looking at a rolling window period for the entire day I'm just looking at the last 30 minutes of data and with that 30 minute rolling window period let's take a look at the S&B 500 and still negative 30 minutes and zero DTE again a strong driver of options trades today it looks like the most of the volume is in the zero DTE options as compared to all other all expirations that would include the zero DTE let's go back let's go to look at book map and everything I see in the S&B 500 is tell me just to patiently wait for short setups let's take a look at NASDAQ so unlike the S&B 500 order flow is more more bullish in NASDAQ note the rising iceberg orders stop orders by stop orders feeling the move higher as well as cumulative volume delta all these numbers are positive all right captain price is Bitcoin interesting day in crypto sorry I this is about options in stocks and futures I don't follow Bitcoin I don't don't think about it don't look at it all right so somewhat of a deep pullback there in the in the NASDAQ maybe heading back trying to head back up to the QQQ 368 level that acted as resistance this morning so there's the price continues higher potential move target for a move higher so RJ wants to take a look at Tesla another strong day in Tesla looks like I need to adjust my lines here for Tesla let's take a look at hero for Tesla so nothing nothing new here just another another bullish day go back to the one-day look back period and it's a lot more clear there so in Tesla traders are buying calls and selling puts call buyers more aggressive and definitely driving price higher the total signal so Tesla often has a very strong very strong correlation between options trades hedging flow and price action and karma FX ask do you engage with any other there's some actually something blocking my I'm sorry I can't read the last crypto I assume maybe crypto related stocks if so no but that you know that's just me this is what let me show book map so these are the this is what I trade the SAP 500 NASDAQ futures and then the large large cap tech stocks Apple AMD Amazon Google Meta Microsoft NVIDIA and Tesla all right thank you karma FX yeah there are some crypto specialist on on book map that broadcasts daily rain and the morning I think maybe around 8 30 a.m. Eastern time and then John maybe once a week I'm not sure so again my focus is on the SAP 500 NASDAQ and large cap tech stocks now there are you know that Bitcoin is not available in hero as far as I know there's no options trades driving driving Bitcoin but there are plenty of crypto related stocks coin coin base marathon digital holdings riot others this is something that not something that I follow really the the focus most real recently really has been large cap tech and AI artificial intelligence so that is kind of what I'm keeping up with in RJ says no stopping the Tesla train that's right they just keep buying calls every day and max asked when trading is do you prefer the combined signal or one of the other symbols I'm wondering if maybe SPX hero signal would be more valid when closer to large strikes now that's something that I've never never thought about I I just look at the total signal that is showing everything that is influencing all options trades that are influencing influencing the SAP 500 let's go back and take a look at hero so for hero we saw that today the signal for the ES futures really had the strongest correlation between price action and hedging flow traders trading ES futures that is often but not always the case SPX somewhat starting in the afternoon session and then spy all pretty much negative delta for today so really the most I think the most accurate the most accurate signal is this total signal all right so Taj I've been talking about how to read book map and hero to determine the market direction or for setups all day that's what I've been talking about for the last hour so if you're joining us late I invite you to take a look at the recording or recording of the session today so using ES and as an example so we see that for the SAP 500 I've told you are ready that I've been leaning short all day looking for looking for short setups that worked in the morning and then has not worked so fell so well since about 1030 but that was my thesis for the day based on first of all the call dominated expiration I've talked about that dynamic and then the hedging flow being bearish for most of the day and then order flow let's go back to book map looking at bearish order flow in the SAP 500 right so again Taj you're welcome if you joined us late I invite you to take a look at the recording it should be posted shortly and Noah says great webinar thank you for your time and efforts you're very welcome thank you for your kind words glad you're here thanks for your questions and comments all right my time is up remember tomorrow drone pal will be speaking before congress at 10 a.m so that should definitely be a market mover be careful tomorrow morning all right thank you again thanks for all your questions and comments and I will see you tomorrow bye