 Hey everyone How's it going out there today? We're gonna talk a little bit about What's going on in the markets here? I'm gonna discuss a couple different themes going into this holiday short and trading week So I hope everyone out there had a great Labor Day weekend It's always a good time to get away from the terminals and Charts and all the financial stuff and just take some time to enjoy our friends our family and whatever else You know, but just decompressing is so important. So just want to put that out there as we kick things off here this is going to be a bit of a combo presentation like my others where we're gonna talk both about live trading and And some of the market structure psychology and other areas. I also have some new features to show with the Options mapping tool that I've been working on I rewrote the engine this weekend and added some improvements to the visualization So I think that'll be pretty fun to check out So without further ado, let's kick things off here. Shall we so I'm markets in mayhem You probably know me by now, but if you don't I'm an experienced trader and investor I did my first trades back in the dot-com bubble trading Yahoo and Amazon and basically flipping them a day later For a near double profit and saying this doesn't make any sense. I don't want to be in a market where things don't make sense and I regrouped came back to the market in 2005 having earned money and you know trading my own account and Started to really learn how to trade and then eventually learned how to invest and traded my way through the great financial crisis learning a lot about Financial and monetary plumbing along the way and that sparked a passion all of this seeing everything and how it fits You know fits together these puzzle pieces. I've always had an inquisitive mind So it's been very fun to kind of put these different pieces together and one thing about finance is no matter How good you think you are no matter how smart you might feel there's always more to learn the market the economy Everything will humble you with the depth and breadth of information that is out there So just something to keep in mind as you know, we look at our own journeys and the world of finance Never stop learning is the takeaway So if you want to find out more about me My work is over at trader aid calm and macro visor calm each one has a seven-day free trial So you don't have to commit anything the trader aid base plan has that seven-day free trial macro visor has also a 30% Discount sale going on for your first year right now. You can also find me on YouTube. I regularly post technical macro Market and other types of content also post podcasts that I've been participating in and producing and that's youtube.com Slash at mayhem number four markets or at mayhem for markets and if you like book map But yeah, I haven't pulled the trigger on buying it yet. I've got some good news You can get up to 40% off by going to trader aid calm slash book map That's trader aid calm slash book map and take advantage of the deals under the special offers there So let's do the fun legal ease shall we I'm going to put on my lawyer hat here 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 trading futures equities and digital currencies involves substantial risk and is not suitable for all investors past performance is Not necessarily indicative of future results and it goes on but essentially please do your homework Don't take trades blindly understand what you're doing and most importantly why you're doing it, right? We have to have a sense as to what our system is. This is the most important part of Really understanding what makes a successful trader and what makes successful trading possible So even though this is all a bunch of legal gobbledygook The reality is that there is some pearls of wisdom here Don't blindly find follow other people including me or anyone else do your own homework Manage your own risk. No one's gonna look out for your money better than you at the end of the day So let's talk about the options market here. We're looking at a visualization of the full s and p 500 index options chain. There's over 9,000 contracts to examine last check there's over 9600 it's about 212,000 data points that I go through to create these charts and We can see that there's a pretty big amount of support if you look at the chart on the right at 4500, right? And that's a very important level It's a very important level because not only is it the largest area of gross exposure It's also an important area Because two points below it is the gamma flip Right and so if you if you hit the vault trigger in the gamma flip in a downward move that could add a lot of selling pressure on the other side however Above we're in positive gamma territory Or above this 20-day moving average as well. We'll look at these charts a little bit later on the s and p but that's constructive and So below we're looking at you know that 4500 level above. We're looking at 4,600 Obviously, there's a little bit of interaction potentially at 4525 and even bigger at 4550 Those are key areas of net call exposure That we should be watching throughout the trading week and We can see that we're just barely in positive gamma territory I talked about that the gamma flips actually been moved up just a little bit since I last looked I quoted it at 498 it's actually now 4509 So that is setting us up for an open where we actually may Get pretty close to that gamma exposure level in the first hour or so of trading something that we should watch You know as you slip into negative gamma territory dealer hedging dynamics may change such that they're more likely to sell rips I'm sorry buy rips and sell dips Okay, so going over that again in negative gamma territory dealer hedging dynamics are such that they may be Selling dips and buying rips. So imagine the consequence of that if you're adding to pressure in either direction of the market, right? You're basically going to amplify moves. So it's a volatility catalyst when you're in negative gamma territory If you're in positive gamma territory like we are right now buy a wink, right a couple points that encourages dealers to Be more likely to buy dips and sell rips Which is a vol compression dynamic and it actually adds a little bit to what we see with zero DTE trading as well Which further compresses volume particularly when you have at at the money put selling and just out of the money call buying It's all in a very compressed range of price. It's all in a very short period of time Which means there's less uncertainty moving forward about price which also leads to vol compression, right? So it's a combination of those forces. So right now with the positive gamma exposure. We have it's estimated that Dealers would be buying about 13 billion dollars of s&p exposure for every 1% Well, some sorry selling 13 billion dollars of s&p exposure for every 1% up move buying the same for every 1% down move And that's that same positive gamma dynamic, right? Essentially adding to this volatility compression mechanism And skew search last week. Why does this matter? What skew? All right, let's just have a quick primer for folks out there that don't understand what any of this means And there's nothing wrong with that. Everyone starts at different levels. Everyone has different backgrounds and skill sets Not everyone needs to be You know completely familiar with the options market But you should be paying more and more attention to it because there are some simple indicators that we can look at Regularly and get a better sense as to what is going on underneath the surface So last week we saw a huge surge in skew as positioning rose as well We saw in flows into a lot of areas in the market particularly from some of these leveraged funds So if you're a leveraged fund, what do you do to reduce value at risk? So you can add to your buying power You have to hedge, right? One way or another you have to have a part of your book That is essentially negative market exposure to offset the part that is positive market exposure and Hedge funds have done that in a variety of different ways Throughout 2023 they've shorted futures remember all the stories from Bloomberg. Oh record S&P futures shorting You know boy the market has to go up to infinity because of this amount of short exposure Not necessarily because those same folks were pretty long the market, right? so they were actually shorting to Increase their long exposure Gross exposure by hedge funds right now is in excess of 250% so you could say they're pretty leveraged on both sides of the book So going back to skew skew is The differential between put and call premium on the S&P 500 in this charts case Okay, so what we're looking at is the extent of the volatility smirk a volatility smirk is the S&P 500 or any other options volatility structure having a Premium that is greater on one side than the other in this case. It's greater on puts than calls Why does that matter because now we're in this first week back? With these gamma with these delta and theta decay flows This huge amount of options positioning that is likely to add to those flows at a time Where there's some dynamics that could help to push the market higher. Otherwise. We're again, we're at the beginning of the month So there's flows because of that. There's the theta and delta decay flows because of this elevated skew You've got so much put exposure in the S&P 500 that rose last week that as those puts decay Dealers are buying back hedges that adds liquidity to the market. Okay, so elevated skew adds to those flows You've also got buybacks in excess of about five billion dollars a day for the first half of September Now on the other side of that because we have to be balanced September is also the worst month of the year going back to nineteen twenty eight fifty five percent of the time September is down On average about one point one percent first two weeks of September tend to be the worst in that data set But you can take various timeframes and find the same data going back 20 years. You see a similar pattern Why is this all important because we need to look at seasonality to govern our expectations? There are positive factors that work here my own opinion my own humble two cents here Is that the difficulty in September probably starts after OPEX with this amount of supportive flow coming in of course? I could be wrong and there's some risks that we'll talk about With that in mind, but keeping an eye on skew to sum this up is a good idea and go to stock charts comm It's free just type in dollar sign skew You know bring the chart back a couple years so you can get a sense and and get a sense It's where the highs and lows are and then you'll have a better idea leading into OPEX How strong those passive delta and theta decay flows that could bid up the market in the first an hour of trading particularly may be Now if anyone has any questions about anything. I'm talking about Please feel free to share it in the discord chat tag me in So I know that you're asking a question because I'm not always aware I've got a lot of screens going on watching a lot of different things or pop it in the YouTube chat All right Happy to answer questions. I don't want to leave anyone behind I welcome people of all skill levels and backgrounds listening to this content and I sincerely hope it's helpful to you So breath is increasingly constructive momentum is improving. We're looking at the New York Stock exchange McClellan oscillator here. We saw it get blown out into oversold territory Something I publicly identified and said, you know what? Sellers are a little exhausted here. It's probably time for some upside. We've seen that and We may see more This is not an overbought reading yet. This is just a reading it. Yeah, there's a push Into accumulating a broader distribution of shares in this market and last week market breadth was decent Wasn't great, but it was better than what we've seen in some of the prior weeks this year particularly in August So that's a little encouraging going into this week. So let's look at the S&P 500 chart First what we can see here is we're above that gray line. That's the simple 20-day moving average I know it's just a very simple indicator But a lot of folks put a lot of weight in the 20-day including market makers I think it's something to watch to get a sense for how this market will trade and Then we look below and we can see that we're in the cloud We're in that green Translucent cloud that's the itchimoku cloud if you don't know what that is and you want to learn about it later You can visit my YouTube. I've got an intro primer I'm gonna be adding more to that content as time goes on But this is a volume weighted itchimoku cloud as well which adds a little bit of nuance shall we say to the data that it's able to show us and We are in the cloud So just a quick primer on itchimoku when you're above the cloud You're in an uptrend in that time frame is a daily chart when you're in the cloud you're neutral and When you're below the cloud you are in a negative trend Trading within the cloud tends to introduce a lot of volatility Because if you think about it when you're in the cloud you're at the point where most positions are Just being have been put on right you've got increased skittishness There are people that are just barely green or just starting to go red as you get back into the cloud So you're gonna see more Vassalations of price shall we say a greater push-and-pull tug of war dynamic with price It tends to be a little bit more choppy So that's something to keep in mind and we've tried to break above that cloud looks like at least once we were Rejected and we're just talking about within the last trading week or so So this week is gonna be a bit of a show-me-story can the spoo's the S&P 500 e-mini futures Break above the cloud that'll be one area the next thing to look at is where we are in the volume profile here You can see that we are in a pretty chunky area of volume profile. I'd like to see a push above So this would take us again above the cloud which is volume weighted So no coincidence that that chunkiness in the volume profile is similar to where we are in the cloud I'd like to see a push above both I think that's what really lets the bullish animal spirits loose on the other side If we break below that 20-day moving average I think all bets are off of the bulls here and we start to make a pretty meaningful retrace back to recent lows So that's the setup going into this week, but I don't know that we're gonna break the range I don't know that the range that we've been trading in will be broken until maybe later this month Unless it's to the upside that is to say the next two weeks are the best opportunity for the bulls to try to make a new high in 2023 Because they have all the support of the options market delta and theta decay flows the buybacks the beginning of month flows pretty much The perfect setup, but at the other side of that once you get into post-op X The bears have the perfect setup because all those flows The buybacks beginning of month and delta and theta decay supportive flows are gone So it'd be very interesting to see how we perform the first half versus the second half of September I think it's it's gonna be very very much worth paying attention to now We're moving on to the NASDAQ very similar look as the spooze trapped in the cloud in This very chunky area volume profile almost paralyzed above the 20-day moving average show, you know Constructive by reserved would be the way that I would describe my bias here You can't go into a market like this and not be somewhat constructive Unless we're breaking down below 4500 on SPX below the 20-day moving average And then becoming much more bearish if we get below the cloud, right? So so that's kind of where we are. I would say Cautiously optimistic the first hour of training today is going to be very important However, because we do need to hold those key levels would also be ideal if we stayed above that gamma flip level Which again is SPX 4511 and are implied open right now is 4507 below that level and Looking at the 10-year note. It is just trying to cling on RSI is about neutral flattening out to 50 Above the 20-day moving average, but it's pretty darn clear this thing is in a downtrend So you're gonna have these reflexive rallies these lower highs and lower lows put in to trading instruments like this And last week there was a lot of question about why did rates move so much on Friday? Why did the dollar move so much on Friday? You know a Goldman Sachs put out a note about this My opinion on it is very simple and I wrote about this in a detailed note to trade rates subscribers over the weekend But my simple take is oil. Oil was up over 7% last week Oil and rates enjoy a strong positive correlation when oil moves higher rates tend to follow particularly in the 10-year note rate And so the 10-year down Okay, that makes sense in the context of look at this oil up and not just up but up to new 2023 highs a Dynamic that's largely driven by very tight supply episodic increases in demand and a situation that's likely not over in fact now that oil has broken out After that head fake lower. It's looking pretty bullish. We could see continuation here I quite frankly would not be surprised to see triple digit oil in the fourth quarter of this year I know it sounds like a bold call It may not be So bullish put talking points. We've got positive gamma. We're above the 20-day moving average The these are things to at least take into consideration here. I Think the bearish talking points However, I didn't prepare a slide for this because I got a little short on time But the bearish point talking points going into today our rates rates rates and oil We got to watch that side of the market so we can be constructive as long as the technical and momentum Factors are in our favor, but as soon as that deteriorates if we start to see some of these key areas taken out We start to see rates and oil rise. I think pressure will increase in stocks So let's get into book map. I'm going to refire up my screen here on the discord server There we go. So you should be able to see that again And we're going to take a little look around some of these markets So first we're starting off in the S&P 500 e-mini futures And we can see there's a reasonably large level of resting liquidity down here at 4510 with 256 contracts pre-market And down here 4500 with 267 contracts pre-market We can also see that the options visualization system that I built is showing us some of these levels right on screen So it's it's actually kind of easy to get a sense as to where these levels are and I would say that options are a very Important part of the market to look at because 70% of notional value that trades is within the options market It's not futures ETFs or stocks its options margin as a Percentage of S&P 500 market capitalization has come down to levels We haven't seen in almost two decades But that's because more and more leverage is being expressed through index ETF and stock options and in shorter and shorter time frames So 55% of SPX volume in the options market trades to expire in six and a half hours or less It's pretty incredible if you think about it. So if you have that level of Trading activity such that it actually dwarfs the futures market and Stock market the tail is really because the dog, you know is being wagged by the tail The tail really is wagging the dog in that market And it's curious because now when you do forensic analysis on financial transactions You see that most of the market maker activity in the most popular stocks that trade with options as well as in the S&P futures And a number of other instruments. It's actually market makers hedging for options activity So the options have become the market and then these other instruments that they're supposed to be a derivative of Are more and more becoming that derivative in the way that trading is Taking place. It's pretty incredible this evolution that's happened over the last several years And then you have more and more zero DTE in every instrument you can imagine first It was SPX then they started adding in SPY and QQQ now the euro stocks and crude oil contract are going to have Zero DTE's it's becoming a zero DTE world. I often like to joke. How long is it going to be until we have one hour to expiration options? We already have a one-day VIX after all So let's go back to the market here Let's zoom out as we get closer to the open just about eight minutes away And we can see there's a relatively large level of resting liquidity overhead now this hot call level is from Friday's trade That was the hottest options volume on the call side I did add some new indicators to the hot call on hot put so that you'll get a sense as to whether they are the most Active strike on the chain and whether put call ratio is in their favor So we'll talk about that as once we see it But we'll zoom out a little more just so we can visualize some of these key levels You got the call wall up here at forty six hundred and you've got that put wall down here at forty three hundred I think it's more likely we visit that call wall than put wall this week personally I mean the put wall is quite a bit lower there, but anything can happen This is a market that does like to turn on a dime now. This is a very light week for catalysts Really the biggest economic data catalyst we have this week is ISM services PMI We've got a smattering of Fed speakers We'll see if the market pays attention to what they have to say And we have a very light earnings week. So the the sort of outside volatility catalysts are relatively subdued Compared to what we've seen in weeks prior. We are coming up to however triple-witching, you know quarterly OPEX Fed meeting And a number of other potential volatility catalysts in the weeks ahead So the first two weeks of September could be much more tame But as we go further into the month, I think it's going to get more interesting Of course, I'm gonna also be watching very closely August CPI data that's released later this month because I think it could continue to show a Bit of a year over year acceleration and some acceleration month over month as well Which may push rates higher and be something That sparks a little concern particularly in the longer duration risk like the Russell 2000 growth and some of the Not as resilient to higher interest rate Nasdaq stocks So we're just about six minutes away from the open here It's gonna take a look at the headlines that are going on around the market so we just got news that Russia is going to extend their 300,000 barrel per day oil export cuts through December and Saudi is also going to extend their one million barrel per day cut for three months until December so the Saudis and the Russians are further Cutting oil. What is that doing to the price of oil? Well, we could see it right here. It's surging It's about two bucks. Okay. This is not good. This is not what we want to see leading into the market Let's see what rates are doing rates are kind of sanguine about this all things considered I would have expected more downward pressure on the 10-year note price, which would bring yields higher But we're not seeing that quite yet despite the two dollar bid in crude So that's something to pay attention to here a lot of shorts are getting stopped out of crude You can see it in these contracts here pushed out to the upside pushed out to the upside And while that's happening you also see some institutional selling So this is interesting Maybe we're starting to see the the end of this big pop here at least for now We've got a large level of resting liquidity and crude here around 86 80 So we'll pay attention to that as we're trading today But at the very least that's not what we wanted to see today. Is it we did not want to see Oil rise. It's likely later that that pushes rates higher as well unless oil gives back some of these pre-market gains The feds Waller had a little chatter this morning. He says he supports skipping the rate hike in September This is a no-brainer bit of news I don't think anyone expected a rate hike in September the real Variability is whether we see a rate hike in November or December at this point with the deceleration that we're seeing in the jobs market I think it's reasonable to say that the Fed is going to be a little bit more cautious about their next hike If that trend continues and if the services industry indeed begins to roll over That's going to be a bit of a concern and I think that could pause their hiking plans for some time On the other side of it. However, there are some signs like with crude oil rallying as it is that inflation could reaccelerate So don't envy anyone that works at the Fed their job is exceedingly difficult, especially in the here and now They're walking a tightrope and if they lean too far in either direction, it's going to cause a lot of pain for the economy So we're looking at the Nasdaq here. It's actually rallying pre-market shrugging off this move in oil Oil is starting to come down. We did notice there were these stopouts that were happening in iceberg sellers coming in So maybe we'll see some pressure on oil back lower here that pattern that Distribution pattern that we see where shorts are getting stopped out and institutional longs are selling into that That's often something that leads to a move lower at least in on a kind of like a scalp time frame, right? Very short term, but we're certainly seeing it. We talked about it now. It's happening Rates are moving down here. We can see that with the 10-year price Moving up just a little bit, but it's still down pre-market and really the 30-year bond is just getting absolutely smashed down About three quarters of percent and the dollar bit up about point four one percent with the yen languishing down about eight point eight seven percent really No signs from the Bank of Japan that they're going to be moderating their Interventionism shall we say they're gonna eventually gradually let ten-year Japanese government bond yields go up to as high as one percent But given the scope and scale of the QE eternity program, they've been engaging in for well over a decade That's a very modest change in the grand scheme So we're just less than two minutes about one minute from the opening here We're gonna zoom in a little bit on this S&P futures contract and book map It's always interesting to watch the opening in the S&P People use various time frames if I'm talking about something you're familiar with you can ignore me But if you're not familiar with this people use various time frames for what's called the opening range And that could be anywhere from like 30 seconds to minutes 5 minutes 10 15 30 minutes so watching the price action as the market opens is really important for a number of different trading styles and We can see some of that resting liquidity below us just Disappeared as we're getting ready to open The market and again if folks have questions tag me in on the discord Let me know or pop into the chat Hey friend, I will move to gold, but I will do so after the market opens I do want to watch this market open and comment on it a little bit We see resting liquidity emerging below us here in greater size than what was removed 512 that well 515 now at 45 1250 worth watching We are remaining above that gamma flip level in the open which is good and remember this first hour of trading is Going to be a lot about these flows. You've got the beginning of month flows from institutions Got these buyback flows and you have delta and theta decay flows all of which are constructive so That just means you get a little bit of buffering a little bit of support doesn't necessarily mean the market Automatically goes higher. It just increases the probabilities that it does and it it reduces the chances of a disorderly sell-down We can see that there's a growing resting offer up here 513 just around 4526 and that is Coincidentally or not right at the fourth largest gamma exposure level on my options mapping tool There are no coincidences in this market these levels that correspond with key areas of options positioning or key levels Otherwise, this is something we see a lot and this adds to the theme of coalescence as a compass the more that you can see Different areas telling you the same thing options resting liquidity volume profile and so forth the more confident You can be in your reading of this market. So right now We're building our point of control and we're testing it. You can see that with the yellow line As we're opening I think that if this market can hold above I think the delta between spx and yes today is about three points. So when hold above 4503 as a bare minimum that's going to be important on yes But I'd really like to see it hold above that flip level that to me is very important I don't want to see us go into negative gamma territory because statistically speaking It's more likely that you see further selling. So now we are testing this Volume-weighted average price the view app is the white line. This is built over really going to be about the last six hours of trading on ES and It may act as support if it doesn't that's pretty telling but right now We're just sort of chomping along and trying to bounce off of it You can see there's a little bit of institutional accumulation here But nothing to write home about and I think it's important to continue to watch for where liquidity builds That's one of the best things about the way that book map works is this heat map is so cool But you can see in real time where these bids and offers are coming in or where they're leaving and also whether they're growing or shrinking All of which gives you a sense as to how participants are viewing price action. So We're going to take a look at the Nasdaq here and It is just the beta beast as I like to call it. It always moves more than the S&P You can see that longs are getting stopped out a little bit here in this last move down But nothing too major Still looking pretty constructive at the open so far rates are stable and Crude is just sort of chopping sideways here But that resting liquidity is building. So this gamma 4 level probably a reasonable upside target for a scalp if we're able to push above that point of control Otherwise, I think we may retest the gamma flip level, which is also an area where there's a reasonably large resting bid And you do see a little bit of institutional accumulation is smaller traders are getting pushed out But it's it's not a lot yet something to keep an eye on We are pushing below the view app here. We're below the point of control So still a very choppy opening so far, but that price of oil rallying I think it may put a pause on the bullish action that does change my outlook here because Remember when we're talking pre-market one of the big risks last week one of the reasons that Friday was a bit of a Bit of a fiasco in the rates market and the currencies market was oil and now oil's building again It's pushing towards if not at Highs for 2023. Yeah, it's we're at highs. Okay, so we're making new highs for the year That's not what you want to see when the idea the zeitgeist is inflation's behind us Inflation enjoys a high positive correlation with the price of oil and that's got a concern traders and investors here So something to keep an eye out Do the bubble show cumulative volume delta? Yes. Yes, they do great question Good morning everyone out there. I hope you all had a good weekend if you're in the US Hope you had a great Labor Day, but wherever you are in the world wishing you well We are crossing below the gamma flip level here This is not a good look for the bulls and has me more inclined to want to look at shorting this market the price of oil surging is Something that is likely to give investors and traders that have a bullish outlook a bit of Pause and you do see some of that resting liquidity starting to build up below us again You see that 293 bid at 4500 and if that grows It could act like a bit of a magnet, but either way prices looking quite heavy here. Let's go ahead and take a look around again We've got the Nasdaq. It's actually looking a little more resilient than the S&P interesting that that's something We're gonna have to keep an eye on rates are flat and Oil is continuing to consolidate these gains So at this point, it's looking more like this market wants to sell it's below this We actually just saw the gamma flip level get recalculated lower because of the amount of put positioning It's being put on right now, which is pretty darn interesting. Let's take a look underneath the surface there at what's going on And it is once again a day where puts are outnumbering calls on the S&P pretty aggressively Let's zoom out a little bit see if any new positions have been put on here in terms of Resting offers not much. You do see that big resting offer fading a little bit overhead You see this resting bid growing a bit at 4500. I still think the market looks pretty weak here Buyers have had a chance to kind of push this thing up off of a pretty key level so far They haven't been able to do so or kind of continue to grind there. It's good that we're building volume But let's see if they can actually defend it Now we're gonna go back to the Nasdaq here. We can see it's actually making new highs here So it's hard to be too bearish when the beta beast is Rocking to new highs here in today That's something to pay attention to every time this thing starts moving It can drag the rest of the market with it and we can kind of see that muted effect on the S&P here So again hard to be too bearish here Even though we've got the price of oil running because the market is telling us it doesn't care yet You got to respect that even if it doesn't make any sense at all. You've got to respect it typically when rates are rising and inflation concerns are Building tech would get smashed But we are in an environment where that has not really been the case since April. Yeah, alien to crypto That's exactly what I'm saying is that you know when you have Oil which touches every part of our lives It touches our lives directly with energy, but indirectly with agriculture pharmaceuticals plastics You name it oil is in everything that we can imagine and when the price of oil goes up it drags inflation higher elsewhere So it's very important to watch and it correlates very well With the overall rate of inflation So now we can see there's a pretty big sell here happening in Nasdaq and the S&P is following the S&P never had That counter trend pop Do the Nasdaq get a little too excited? Maybe we just saw 217 contracts blown out We do see a little bit of institutional buying, but it's mostly small traders getting pushed out of positions here Meanwhile Nasdaq's trying to build a base right back here at the point of control Something to keep a close eye on if it can't build here at the convergence of the point of control and VWAP Look out below at that point again bias starts to look more bearish again More stops getting blown out to the downside in the spooze or the S&P E-mini futures here Let's go to rates not much happening there and in crude oil It's actually coming down a bit and remember we talked about this a little earlier when we saw stops getting Blown out to the upside during this little run But we saw institutions selling typically that's again and it's sort of a intra day or even intra hour Kind of topping that you see and remember crude doesn't trade quite as much as the S&P so smaller numbers can mean bigger things in fact open interest in crude is pretty darn low and That open interest in crude being low actually means that if we do see a lot of trading come into crude It can move the price Significantly in either direction So we're going to go back to the spooze here We see that resting bid at 4500 growing and we see that resting offer above Shrinking we also see other resting offers shrinking. What does this tell us? It tells us the market is getting heavy. It wants to likely move lower here So we had that little blip from the Nasdaq. It's gone. We tried again. We're now back down Buyers are not having a very good day so far It literally looks like this market's too heavy to move higher and here's the Nasdaq crossing below the point of control and view WAP thus confirming the negative momentum. So at this point this market looks like a short to me Now we've only got 16 minutes left Until I've got a hop But if you enjoy this type of commentary, you're always welcome to follow along This is the type of stuff we do at trader aid on our discord I will be live streaming there more often as will my good buddy and co-founder horse With his friend Leo tomorrow, they'll be talking about trading the Nasdaq on a live stream starting at 9 15 a.m Which should be a lot of fun Yeah, you're welcome and anyone who has any questions about anything. I'm talking about here. Otherwise Please feel free if you're on the discord just be sure to tag me in so that I see you what you're writing to me And as always I do enjoy being here with you all both on YouTube and on the bookmap discord. It's a lot of fun talking markets Looking at what's going on in real time once again Nasdaq doing its thing But I don't know it just still has a heavy look to me. Maybe I'm wrong But this this pattern here kind of looks like it wants to start to move lower The thing about the Nasdaq is it exaggerates every move So it's like it's just it's just a beta machine as I like to call it Rate starting to move just a little bit lower here oil continuing to retrace down just over 30 cents from its intraday high and 2023 high With a large amount of resting liquidity below which just it suggests That perhaps we get that retrace There's a lot of folks that are wanting to either cover shorts or buy exposure Down here and in the absence of broader trading and you can see there's not a ton of liquidity in this contract It tends to act like a magnet Going back to the spooves and We can see that the hot call and hot put are very close together today That's not often the case it is here and now and the hot put has an asterisk which means that We are at a greater level of put call, right? So there's more puts than calls And that the put that it is identified is the most active put on the s&p chain for today It's pretty cool. All happens automatically. I've been improving this options engine There's a lot more stuff that I'm going to be adding to it But this is one thing that I think is pretty cool to have just right in book map because why have a million different screens open So this is something that eventually I hope to have available on their marketplace. I'm working with their development team, but I At least have it streaming live on the trader aid discord server 23 hours a day five days a week and We can see there's there's this early options trading could be quite Active and volatile now we can see the hot call has moved higher by I want to say about 10 handles And it is now the most active options on the chain with the put call ratio tilting in favor of calls by just a modicum it's point 999 the largest level Gamma exposure you guessed it 4500 on SPX and So that hot put once again. This is similar to Friday. It's it's right at that gamma flip level So again market continues to look a bit heavy You do see institutions accumulating you do see small traders getting pushed out But the delta between the two is not high enough for me to say okay. This is a buying opportunity. It's it's very gradual It's very subdued. There's no excitement here with the institutional accumulation and there's no real fear in the amount of stops You know like 161 here 80 there Nothing to really shake a stick at I'd like to see a lot more to get Constructive on this on the basis that there's been enough people blown out of their trades for now I still think it makes sense to see this thing sell down. I think that 4500 Resting bid is more than likely to be filled Peter asks on YouTube. How often do I stream so on book map? I'm here every Tuesday at 9 a.m. Eastern and then on trader aid on the discord I get on as often as I can either talking markets and macro or live streaming trading and then also I'm preparing weekly a piece called navigating the markets which about a 10 or 15 minute read It's a very in-depth version of kind of the primer. I gave to you all today. So Long answer short form is I stream as often as I can I provide a lot of other content in written form as well alien to crypto I Will look at that if you want to ping me on Twitter my handles mayhem for markets but I use global plus I Have the global plus Subscription because of the the unlocks if you look at the book maps features You can figure out which one's best for you And I'm more than happy to answer any questions once we're off the live stream and Folks out there. I want to thank you all for tuning in really appreciate all the support It's great to see people tuning in checking out the work that I'm sharing here If you're just tuning in now the stream will be available for you to replay in their first 25 minutes Is my presentation talking a little bit more about what I saw going into today a lot of that However was upended by the fact that Saudi Arabia and Russia cut oil so significantly the price spiked about two bucks And that took the wind out of the sales of this market this morning So, you know, you've got to be ready for anything you can come in with a trading plan and the market can say nope This is what I think is going to happen So maybe you come in thinking things look constructive from the price action of the week prior and then you get a random Exogenous volatility catalyst and you have to reevaluate things and that's exactly what we got dropped into our lap this morning Now one thing to know about the hot put and hot call is they tend to have a pretty big impact on price discovery It's not often that price moves too far below the hot put Usually you see it move down first and then price follow Doesn't always have to be that way if selling pressure is high enough the sellers can Certainly move faster than the options market But that's one thing we see right now. We're just kind of hovering right exactly at that level Which is also that gamma flip level and I think that's pretty important the convergence of those two and That we're just sort of sitting here I think taking that out would probably lead to more downside volatility particularly the gamma flip I wouldn't be surprised to see hot the most active put move lower on such an event as well But for now the largest level of resting liquidity that we can see and we're gonna zoom out to be sure Yep It's it's really going to be 491 at 4500 and So to me that looks like a magnet That wants to pull price towards it So folks just about five minutes left before I have to close out the stream Once again, just opening the floor to any questions or feedback people have happy to address it And I'll be back next week at 9 a.m. Eastern same time same place You'd like to check out my other work. You can check me out on trader a calm Where we talk about sharpening the edge of traders trading short to intermediate time frames and a variety of asset classes That's also where you gain access to this options mapping tool and a number of other tools. I've been building And you can check out my work at macro visor comm as well Where we help people gain more insight we make macro actionable and We come up with a longer-term trading and investment strategies Analysis of the big picture all the way down to the micro details each service has a seven-day free trial for trader a that's just on The base plan, but you'll get more than a flavor of what we're doing there And for book map if you want to check out what we have on screen here If this might help your trading style check out trader a comm slash book map for a 40% discount on select plans Let's check around these different parts of the market here as we get ready to close out this dream The Nasdaq looks terrible talked about that a little earlier. I just had a gut feeling I don't know exactly how to quantify that as a trader because you know where the chart was at the time It certainly didn't tell us overtly that it was bearish, but it was starting to look choppy I just had a feeling the way it was trading that it couldn't take off on its own accord that it was looking pretty weak and Again, like oil prices surging is not bullish for tech So the resilience we saw if it could have held that would have been great relative strength instead It's not it's doing what you know, what is logical, which is a very anti 2023 theme the market doing what is logical And if you've been trading this market this year, you know exactly what I'm talking about Crude oil pretty flat after having consolidated rates actually start to push higher here Not what the market wants to see and certainly that will put pressure on the Nasdaq So as we close out here, I still think that at the very least we get that order filled around 4500 I do believe the path of lease resistance today may be lower now this 4500 level We're testing is very very key. We talked about it earlier about how much positioning is there So breaking below it would trigger more volatility and likely more selling and there's probably going to be a good deal of fighting Before that actually happened. So whether that ends up happening today or later this week or it all remains to be seen But we have a pretty good opportunity For that playing out here today or tomorrow given the way this markets trading and the kind of negative catalysts that we have building in You really don't want to see rates moving higher than they already have that is the key here Equity risk premium is already at the lowest level in about two decades on the Nasdaq and the S&P when you're comparing it to Treasury bills This is a situation where these you know the S&P's had three sequential quarters of declines And so with interest rates continuing to move higher It just makes fixed income more attractive than objectively overpriced equity exposure And I think that might be something we see a little bit more of as a theme in The later part of the third quarter and the fourth quarter of this year that there are components of fixed income that are more Attractive than equity isn't it makes sense to get exposure there personally what I've been doing is getting exposure to Treasury bills Where I've been able to book profits on trades and then park them into something that earns an income We can see the market continuing to move lower here closer to that 4,500 level with a large amount of resting liquidity again looking pretty bearish in Terms of the way this is trading you could say that this has been On various time frames and opening range breakdown. We're just waiting for the 30 minute confirmation here But it seems like that's going to be the case for that time frame as well This is likely to be a choppy day But I still think the path of least resistance is lower and breaking below 4,500 would really set that into motion So I hope everyone enjoyed this stream. I really appreciate all of you tuning in check me out on Twitter mayhem for markets Same handle on YouTube mayhem for markets number four in the middle and I will catch you next week Tuesday at 9 a.m. Eastern Take care folks