 Hello everyone welcome to options with Doug streaming live daily 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 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 in book map discord there's the options dash Doug chat channel that's a great place to post questions comments and content related to the topics of this channel that I'll go over in just a moment and for those of you who do not belong to book map discord it is free and available to everyone whether you have a book map subscription or not and then finally I'm also on X formerly known as Twitter and my name there is at Doug plus the focus of my presentation today and the focus of the options dash Doug chat channel is options order flow the impact of options markets on stocks and futures and the influence of market maker hedging flow on price action have a two-step process for trading and the first is planning and I use positional analysis I look at how traders and market makers are positioned 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 maker hedging flow and spot gamma hero to confirm my thesis and for setups and when I talk about setups today I will be talking about setups and an underlying asset and setups can be taken with futures shares of stock or options for example a setup in the sb 500 can be taken with ES futures or 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 discord as well as the chat and YouTube for your questions and comments so please feel free to post and I'll do my do my best answer your questions here's my agenda for today what I want to cover first of all I want to go over news items economic data events and earnings for today as well as the rest of the week then I'll go through my positional analysis then I'll review some setups from this morning and then we'll take a look at the live market and if anyone has any stocks they want me to take a look at when I get to the live market please let me know and we will can look for setups alright so first of all news items today there were a couple of not necessarily high impact more medium impact news items today consumer confidence at 10 a.m. came out less than expected and also at 10 a.m. new home home sales came out less than expected that was at 10 a.m. today and then for the rest of the week tomorrow durable goods orders at 8 30 a.m. Eastern time then on Thursday the GDP report comes out at 8 30 a.m. Eastern time and then finally on Friday at 8 30 a.m. Eastern time the PCE data comes out and that is also the end of the month into the quarter the date for the JP Morgan collar roll and that the put could come into play we'll take a look at that in in a few minutes and then at 10 a.m. the consumer sentiment comes out this is the mission Michigan consumer sentiment at 10 a.m. so that's the rest of the week and they're also Fed speakers throughout the week alright so that is the news items for today and for the rest of the week alright let's go through positional analysis now I'm going to start with the SB 500 this is the SB 500 futures and book map and before I take a closer look at this chart I want to take a look at a larger time frame I'm going to go to the SPX this is a 30-day one-hour chart showing price and key levels let me point out a couple things on this chart first of all this is the September monthly expiration the third Friday of the month the 915 expiration very large expiration call dominated and that is the when this downtrend began at the call dominated 915 expiration as all of that call gamma that was supporting the market expired and now the SPX has moved down below the low of the August 18th negative gamma put dominated expiration and also SPX is trading below the lower daily expected move which is here shown with the dash blue lines and headed toward potentially the lower weekly expected move shown with the dash purple lines alright those daily and weekly expected moves are information available from any trading platform that has an option change should be so that is the again the expected moves alright let's take a look at some additional data the red horizontal lines are showing the spot gamma gamma levels these are proprietary levels gamma weighted open interest let me point out the key daily levels first of all here is the put wall at 4300 that's the strike where the largest net negative gamma it can be expected to act as support and it's not doing its job today SPX is trading below that level and note that level has been pretty stable let me just check so since the 22nd of September the put wall dropped down to 4300 so for the last couple of days it has remained at 4300 that I interpreted that or spot gamma interprets that as a an acceptance of price and traders not reaching four puts below that level that may change tomorrow so SPX trading below its put wall the next level up is the volatility trigger that's at 4,360 that a spot gammas proprietary gamma flip low 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 and SPX also trading well below its volatility trigger that level did drop pretty substantially from 4,480 yesterday to 4,360 today so that is somewhat bearish and we'll take a look at the gamma notional in just a minute but all the indices are in a very negative gamma position and that is helping to drive the move lower than today I think so we'll take a closer look at that in just a few minutes so that is the volatility trigger the next level up is 4,400 that is the absolute gamma strike that's the strike with the largest absolute positive and negative gamma that level did move up from yesterday it was at 4,300 yesterday moved up to 4,400 today and then finally the call wall at 4,500 that's the strike with the largest net positive gamma that can be expected to act as resistance that level did move lower from yesterday so the volatility trigger and the call wall move lower the absolute gamma strike moved higher and the put wall remains the same so the floor potential floor should be floor as at 4,300 the center is at the absolute gamma strike at 4,400 and then the call wall at 4,500 and again SPX trading below all those levels all right let's take a closer look at the levels that are in play for today I'm going to go to another SPX chart this is an SPX one-day chart here's the put wall 4,300 also the lower daily expected move SPX trading below both of those levels and again well below the volatility trigger and let's just see what may be below and pretty much avoid down to the 4,251 level that's a combo L4 level at 4,251 so pretty big gap and gamma levels between 4,300 and 4,250 all right let's take a look at book map now so in book map I've got my cloud notes and I'm showing SPX levels so there's the 4,300 put wall here's the 4,277 support level that was not shown on the thinkorswim chart that is something that is noted in the spot gamma AM founders note that was the lowest level of support noted in the founders note below the 4,300 level so those are SPX levels I also have spy levels so the upper label there is the 4,30 absolute gamma strike put wall for spy there's the lower daily expected move so I have the for ES here I have the SPX gamma level spot gamma levels as well as all the round-diver levels in spy and then the ones that are gamma strikes spot gamma strikes I have noted with the Y label there and note there is a difference between the price of ES and SPX and this morning it was right around 40 so that's what I'm using now looks like it may be a little bit lower than that somewhere between 39 and 40 so I'm using 40 so the 4,300 put wall for SPX is shown at ES 4,340 and we'll take a look at setups in a few minutes so those are the levels and note the spy 4,31 level as well as this 4,324 resistance level did act as resistance before the cash open and the SB 500 move below the 4,30 spy level found some support at the 4,27 level resistance at the 4,300 put wall level that should act as support and now the SB 500 is creating right around 4,26 as well as that 4,277 support level we'll talk about setups in a few minutes let's take a look at NASDAQ alright so I talked about shifts and levels for shifts and levels for the SPX for spy there were no shifts and levels so the put wall and the absolute gamma strike remain at 4,30 the call wall remains at 4,50 all right let's take a look at NASDAQ and let me check for questions all right uber trader says hello Doug thanks for sharing sharing trading ideas you're welcome could you change the colors of chart so hard to see there let me show you something here all right which color settings are you talking about and just just to note I have spent a lot of time working on my color settings I think I think they work well for me so if there's something that's hard to see specifically please let me know maybe turning down the the heat map will help so the heat map is showing the history of limit orders in the order book so maybe that will help I turn that it down a bit and just focus on the volume dots all right let's take a look at NASDAQ and this is the NQ futures before I take a closer look at this chart I want to take a look first of all at QQQ take a look at the levels and play surely the only spot gamma level in play for today is this combo L3 level and we'll see that lines up with an NDX level so combo levels for the NASDAQ are combining QQQ and NDX gamma into one level and here converted to an equivalent QQQ number in this NDX chart converted to an equivalent NDX level at fourteen thousand five seventy six all right so here's that level NDX level on my NQ chart so for NASDAQ for NQ I have NDX spot gamma levels there's the fourteen thousand seven thirty zero gamma level that acted as resistance this morning I also have QQQ levels round-dubber levels and in the range of this chart there are no no QQQ spot gamma level shown just the round-dubber levels then I also have the NQ round-dubber levels the zeros in the fifties there's the lower daylight expected move NQ trading below that level all right so the 356 level for QQQ has been in play resistance resistance and now NQ is trading down toward the 354 level all right so those are levels in play for for NASDAQ and as far as shifts in levels go for NASDAQ there were none NDX and QQQ all levels remain the same all right let's take a look now at gamma notional and see how market makers were positioned on the gamma curve at the beginning of the day this is what I'm looking at right here this gamma notional for SPX spy and QQQ not generally the the number for NDX is so small it's just insignificant compared to the others so note all these numbers are quite negative that's 1.133 billion negative gamma notional for SPX 2.77 billion for spy and 972 for QQQ 972 million negative for QQQ what this indicates is that traders are long puts market makers are short puts and they have to trade with price to hedge their delta exposure this is very negative gamma environment although less negative than yesterday so all these numbers became less negative than yesterday and most likely tomorrow they will be more negative all right so let's take a look at the Vana model we can get a graphical representation of what exactly this means so this is SPX the Vana model what this chart is showing is market makers delta notional on the vertical axis and how that changes with price shown on the horizontal axis there are two curves on this chart the light gray curve is showing how market makers delta notional changes with changes in price only the purple curve adds implied volatility to the equation this is showing how market makers delta notional changes with changes in price and implied volatility and that change in delta with a change in implied volatility is the Vana effect Vana is a second order Greek remember market makers always want to remain delta neutral I'm talking about options market makers their only job is to make markets and they want to remain delta neutral so they have to buy and sell futures as traders take options trades in SPX by ES and market makers take the opposite side of those trades and they have to sell futures to hedge their delta exposure so let's take a look at SPX right now trading right around 4280 let's see if we can find that on the chart by the way this very steep skew to the left is very typical of a negative very negative gamma environment so here this is right around the price of SPX right now so what this indicates is that if price continues to fall implied volatility increases market makers will have to continue to sell futures to hedge their delta exposure on the other hand if price increases implied volatility drops market makers can buy back short hedges so you can see in this negative gamma environment with this left skew curve they were trading in the direction of price so this is showing again as price decreases implied volatility increases they have to sell futures to hedge their delta exposure and I think that has been a key driver of price today is this Vana effect let's just take a look at VIX this is VIX for today high for the day at 1874 so VIX is trading close to the high of the day so VIX generally has been increasing all day it's up almost 10% today I know that's hard to read I'm just looking right here I'm sure that's impossible to read but it's about 10% a little bit less all right let's take a look at the Vana models for spy very similar steep skew to the left very negative gamma spy is trading right around 426 426 and a half so right between these lines so very on the steep negative gamma portion of this curve same same idea as SPX again market makers want to remain delta neutral price drops implied volatility increases and they have to sell futures to hedge their delta exposure and they can buy back short futures as price increases and applied volatility drops finally QQQ trading just under 355 this line right here again on the very steep portion of this Vana curve let's take a look at one other thing I showed this yesterday when I talk about the gamma curve this is what I'm talking about so this is for SPX and one thing of note here note this sharp curve in the gamma curve here this is indicating at this point this is showing right around 4184 this is for SPX at this point this gamma model showing that market makers are fully hedged it may not have to do any any more hedging so this right around 4200 is a potential potential bottom and market makers are fully hedged they don't will not have to continue to sell futures and in fact is if price continues to decrease they may be able to buy back some of their for buy back some of their shorts that's at least that's what's the gamma model is showing one other thing to note is the let's see the oh here this as price approaches 4200 this is the JP Morgan collar put position and as price so that's expires on Friday as price approaches the gamma will increase remember gamma is greatest at expiration at the money so as price approaches that 4200 level that this put position could become more important and potentially attract price alright so that just enhances that importance of the 4200 level alright let's take a look at some setups now I'm going to start with the S&P 500 this is the hero signal what this chart is showing is price for SPX that's with a white line and the hero signal hero is hedging impact real-time options and this is showing options trades and market maker hedging activity for a combined signal for SPX spy XSP and ES futures all into one combined signal and let's zoom in on this chart now and we'll see that options traders are really fading this move lower not really providing much of a clue for for trade today so that's one reason is so important to look at the the gamma notional and the Vana model and look at Vix and price and so I again I think that's what's driving price lowers this significant negative gamma I want to take a look at the S&P 500 take a look at order flow in a few minutes so what this chart is showing again is mark this is the rising purple line is indicating traders are taking positive delta positions and that is really only having an impact to somewhat subdue price rather than contributing to a sharp removed lower options traders are fading this and taking the opposite side notice as the hero signal started to drop then price started to move lower now it looks like options traders are starting to take positive delta positions again so I think again that this these option traders are having an impact is to subdue or just make this downtrend not as bad as or not as not as strong as possible if they were trading if they were trading in the direction of price I think the downtrend would be much stronger or the down move would be much stronger all right let's see what they're doing now so they're buying calls this is pretty significant let me just so they've been buying calls all day shown by the rising orange line and that positive notional value there five billion that is this big number pretty significant they're also buying puts note that activity started to accelerate lower right around 11 a.m. and so that is minus 2.7 billion so again they're buying calls and buying puts today and the SPX by ES call buyers more aggressive and all they're doing I think is slowing the move down all right let's go take a look at the book map go back to ES so right now it looks like ES may have found some support at 426 and the 4277 support level so let's zoom just a little bit to the earlier session so the down move that we see on the chart now that's showing on the chart now really began right around 80 8 to 8 30 a.m. Eastern time resistance here aggressive sellers coming in wrong tool shown with the magenta volume dots the volume dots are showing by minus sell and magenta magenta dots indicate they're more sellers than buyers these are market orders then right after the cash open the aggressive sellers come in again these volume dots are showing delta by minus sell magenta indicates more sellers than buyers and they move price down to the right around the 427 level notice this price was falling cumulative volume delta showing what the pink line is falling also sell stop orders helping to fuel the move lower shown by the falling yellow line as well as these red dots and large traders were pretty aggressively buying this on the way down that's shown by this icon those are iceberg orders large traders use iceberg orders to hide their size that's shown by the rising blue line there the light blue line right so order flow confirms a move lower at the open and prices reacting pretty well at the levels this cluster of levels 428 to 4300 acting as resistance 428 acting as resistance again alright so there's the read in the SB 500 was a little bit difficult today if you're relying specifically on hero I think again understanding the negative gamma position and the Vanna model helped to put some context around the move today and understand the move today all right let's take a look at Nasdaq and Floyd's garage says nice call gamma unwind I I'm not sure that was the factor today I think the fact or more today was just Vanna and the move higher in Vicks all right Floyd's garage also says blew over the pink line good for pops the blue over pink line all this is let's go back to the SB 500 this is the cumulative volume Delta line pink and this is just something that's automatic with book map the I guess the default settings for cumulative volume Delta CVD when it changes from negative shown with the pink or magenta line to the dark blue line that indicates a shift from negative CVD to positive CVD and I'm not sure I would rely on that for any kind of trading signal let's take a look at Nasdaq and Floyd's garage of talking about a call gamma unwind at options expiration I would be looking for more of a put Vanna rally so we look for a call gamma unwind in a bullish market where traders have been buying calls it's possible if traders continue to buy calls and the SB 500 but I typically look for in a bullish week I would look for a call gamma unwind at the end of the week particularly in stocks like some like like Nvidia or Tesla traders have been buying calls all week they expire at the end of the week and as those calls start to lose value due to charm then market makers can sell their stock edges I'm not really looking for that dynamic to this week I would be looking for more of a put Vanna rally in this very negative gamma put dominated environment alright here's Nasdaq let's take a look at the hero signal for Nasdaq I'm going to go to a combined signal for NDX and QQQ very similar situation traders have been options traders have been taking the opposite side fading this move up until about 12 30 12 20 hero line rising and again I think having an effect of really just limiting the move lower and notice as they this hero signal starts to shift lower than price can move lower so again it looks like for hero for Nasdaq the options traders are just kind of limiting the extent of the move down let's see what they're doing so they're buying calls and buying puts and notice the call buyers took their foot off the gas right around 12 20 and just about that time they started buying puts so initially earlier they were selling puts and then they started buying puts but both the numbers are positive net positive for the day so net for the day they have been selling puts and buying calls back to book map again this 730 zero gamma level acted as resistance before the cash open so just a little bit and cumulative volume Delta has been mixed overall net negative for the day shown here stop orders helping to fuel the move lower that shown by the following yellow line here sell stop orders fueling the move lower and note that large traders had been buying the move down and they started more aggressively right around 11 a.m. a few minutes later this is quite large now this is an aggregation because I'm zoomed pretty far out an aggregation of 128 orders that's 2,963 contracts so large traders buying with iceberg orders this number is positive for the day so they are helping to support price for Nasdaq and to limit or the limit the extent of the move lower options traders taking positive Delta positions market makers take the opposite side they have to buy futures to hedge their delta exposure and that is in opposition to the the Vicks Vana model or Vicks in for Nasdaq all right let's take a look at some stocks first of all let's take a look at Apple going to go back to Hero go to Apple zoom in on this see what traders are doing so they are selling calls and selling puts orange line falling orange line negative notion of value indicates their selling puts rising blue line positive notion of value indicates their selling calls so they're selling premium let's take go back to the total signal now and notice this flow alert here they came in right right around 950 this is something that has been in beta for several weeks I believe it on Monday it was introduced to all spot gamma alpha subscribers these alerts and they're shown here so they're quite a bit of alerts these are for all the hero stocks right now I don't know if I've requested that there be some way to limit that to potentially a watchlist or something like that all right so this is traders taking negative Delta positions in Apple at the open price moves lower and as the hero signal levels off so does price let's go to book map and 175 is the hedge wall so price trading below the hedge wall 175 so this was good for a couple of moves couple of points lower in Apple as traders were taking negative Delta positions and again as the hero signal as levels off so does price oscillating of right around the 473 level and notice that a large amount of the volume is right right there just under 173 that's volume for today this is pretty unusual that the point of control for a stock will move beyond the opening print so notice the point of control there with that purple line has moved down right around the just under the 173 173 80 all right those so there's Apple look at Amazon go back to hero so another situation where options trades were had a strong influence on price this is pretty typical of stocks a lot of these stocks a lot easier to read than the s&p 500 very direct correlation between options trades and hedging activity and price action so here this flow alert comes in a little bit late sometimes SWAT gamma has talked about these flow alerts as an indication of mean reversion and here the hero signal does turn up but price does not really respond to see what traders were doing so they were buying puts this morning that's shown by the falling blue line let's go back to book map traders buying puts market makers sell the puts and they have to sell stock to hedge their delta exposure good for a quick three-point drop lower in Amazon this morning let's take a look at Nvidia a little bit different price action for an Nvidia today this is probably helping support the market as well let's take a look at hero for Nvidia so initially traders were taking negative delta positions then right around now 950 they started taking positive delta positions helping to fuel the move higher and then right around 1050 they started taking negative delta positions and price moves lower let's see what they were doing so they're buying calls and buying puts today and these call buyers were driving price higher right around 950 blue line is pretty flat call buyers driving price higher right around 950 let's go back to book map gonna zoom in on this so here's that reversal hire notice all the magenta volume dots aggressive sellers move price down to the liquidity at 417 that's shown in the the heat map that's a history of the limit orders those are limit buy orders and price reverses that that level aggressive buyers start to come in shown by the green volume dots then price makes a series of higher lows good pullback entries for a move higher up to 425 high liquidity target at 425 and then also one last push higher to 428 multiple pullback entries as traders were buying calls market makers sell the calls and they have to buy stock to hedge their delta exposure let's go back to hero now right so 425 was the hedge wall and then above that is the 430 key gamma strike so if price had continued higher that would be the next target most likely a lot of liquidity at that level let's go take a look so the heat map is showing highest liquidity at the the fives and the zeros there's the 425 hedge wall and the 430 key gamma strike high liquidity locum located again at these zeros in the fives and also the key spot gamma levels all right Derek says plan on showing up for next one Doug great glad you're here you're welcome you know hope to see you next time right so Ford's garage if we will take a look at potential call gamma unwind on on Friday Thursday we'll see if if activity like this continues in Nvidia for example we'll look for we'll take a look at the amount of gamma expiring at the end of the week and look for potential call gamma unwind candidates again I would be looking focusing more on that in a more bullish environment and let's see let's take a look at a couple of other stocks here go back to hero so right now in Nvidia looks like options traders starting to take positive delta positions again and that's right around the 420 level let's just go back to go back to book map alright so there's 420 good support level so here we missed it this was a long set up at this 420 level look high liquidity as options traders started taking positive delta positions so Floyd's garage will look for both but again for the SB 500 I'm looking more for a put Vanna rally and for stocks like Nvidia and maybe Tesla may be looking for a call gamma unwind so separate in your mind looking for put Vanna rally in the SMB 500 and NASDAQ and potential call gamma unwind in Nvidia Tesla and I'm focusing again more on the put Vanna rally right so there's there was a long set up there in Nvidia let's go back to hero we'll scan through and see if we see any more potential setups take a look at Tesla so right around 1050 traders started taking negative delta positions they continue to do so and Tesla is moving lower so they have been buying puts and selling calls it looks like around 145 they stopped buying puts shown by the leveling off of the blue line let's go take a look at book mount alright slow to Zari says meta has a news event tomorrow about upcoming products is there anything unusual for meta tomorrow so let's take a look at that go over to meta let's go to hero meta alright so for meta 300 is the key gamma strike it did act as resistance so initially traders were taking negative delta positions then right around 1020 start started taking positive delta positions price moved up to the 300 key gamma strike resistance level and since then traders have been taking negative delta positions let's just take a closer look at what they're doing so for the day they for the day they have been selling calls and buying puts so slow sorry traders are taking net for the day negative delta positions 297 50 is the hedgewall 300 the key gamma strike let's go back to book map alright so the the point of control here that's at the opening print is right around the hedgewall just above at 297 50 here's the 300 key gamma strike that acted as resistance but nice reversal higher good for point four points from 296 to 300 as traders were taking positive delta positions so there you go slow to Zari let's take a look at one other thing for meta just see how traders have been positioning for the last few days alright meta put dominated below 310 which is the call wall call dominated above and the key gamma strike has been pretty stable at 300 right so 300 is the key gamma strike and then also the call wall has remained stable at 310 put wall at 290 right so all these levels have been pretty stable for the last few days traders are not taking any it looks like traders are not taking any significant changes in positioning up to this event let's go back to hero so again for the day traders are taking slightly negative delta positions alright redshift trucking says and yesterday's spot gamma presentation on flow alert a chart demonstrating after about 1 p.m. eastern time the hedging flows lighten up they don't recommend trading the flow alert after that time alright great thanks that's good to know I have not had a chance to watch that yet usually I can't watch it during the during the day during the live session it does overlap with my session and it takes spot gamma a couple of days to post it up the archive recording for viewing so it's wondering your view on the slowing of flows as it relates to your trading do you curtail your trading in the afternoon I generally do not trade in the afternoon so I as far as day trading goes I trade in the morning I typically trade from 945 to 12 that's my day trading and then I will take focus on my longer term positions in the afternoon selling strangles and butterflies and longer term positions so I do my day trading in the morning and longer term trading in the afternoon alright so slow to sorry I hope that gives you some insight for meta tomorrow looks like the key daily levels have been pretty static not a lot of shifts traders taking slightly negative delta positions for today alright everyone that's all I have I want to thank you for watching thank you very much for your questions and comments and I will see you tomorrow remember tomorrow the GDP report I'm sorry durable goods comes out at 8 30 a.m. Eastern Time maybe a market mover we'll see alright thanks again for watching thanks for your questions and comments and I will see you tomorrow bye