 Hello everyone, welcome to Options with Doug, streaming live daily on Bookmap Discord and the Bookmap YouTube channel at 1.30pm Eastern Time. Before I get started, I need to go through the Disclosures. General Disclosure. All Bookmap limited materials, information, and presentations are for educational purposes only and should not be considered specific investment advice nor recommendations. 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 Bookmap Discord, there's an options-doug chat channel. That's a great place to post questions, comments, and content related to my presentation as well as the topics of the channel, which I'll go through in just a moment. And note that Bookmap Discord is free and available to everyone, whether you're a Bookmap subscriber or not, and there's a lot of great content there. I'm also on X, formerly known as Twitter. My name there is at Doug Plus. The focus of my presentation and the focus of the options-doug chat channel in Discord is options, order flow, the impact of options markets on stocks and futures, and the influence of market maker hedging flow on price action. I have a two-step process for trading and the first is planning, and I use positional analysis. I look at how traders and market makers are positioned in the options market and how those positions change from day to day to develop a thesis regarding the expected trading range and volatility for the day, as well as a directional bias. And the second step in my process is execution. And I look at real-time order flow in Bookmap and real-time market maker hedging flow and spot gamma hero to confirm my thesis. And for setups for entries and exits, and when I talk about setups today, I will be talking about an underlying asset. For example, setups in the S&B 500 can be taken with ES futures, spy shares, spy options, SPX options, or even ES options. Questions and comments are welcome, and I will be watching both the options-doug chat channel in Discord as well as the chat in YouTube for your questions and comments. So please feel free to post. I'll do my best to respond. And hello, Don. Welcome. Glad you're here. All right. Here's my agenda for today. What I want to cover, first of all, news items, economic data, events, and earnings for 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. When I get to the live market, if anyone has any stocks they want me to take a look at, please let me know, and I'll be glad to do that. And by the way, just a reminder for those of you who are watching on YouTube, I have adjusted the settings and the software that I use to stream to YouTube to stream at 1080p. So if you're having any difficulty with the resolution that you're watching, you can go to the settings in YouTube and change it to 1080p. All right. Let's get started with news items, economic data, events, and earnings for the week. So first of all, I'm just going to go over the high impact events. And the first is tomorrow, Tuesday, 8.30 a.m. Eastern time, retail sales come out. And then on Wednesday, the 18th, building permits at 8.30 a.m. Eastern time. Not sure why that's marked as high impact, but it is. And then after the close on Wednesday, the 18th, Netflix and Tesla report earnings. So the first of the large cap tech stocks report third-quarter earnings. And then on Wednesday, Thursday, I'm sorry, Jerome Powell has a speech, speaks at 12 noon, I believe. That's the time that I saw. So Jerome Powell speaking on Thursday at noon. And then Friday is the options expiration for October, the monthly options expiration. And as the expiration approaches, we'll take a look at the option structure. Delta calls and puts Delta, call and put Delta for the expiration to get a sense of what may happen after the expiration. All right, so that is the news items for the week. Now let's start with positional analysis. I'm going to start with the ESMB 500. This is the ES futures in 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 ESPX. That is the main index. ES is a derivative of SBX. So SBX, the main index. This is a 30-day one-hour chart just showing price and key levels. So let me point out a couple of turning points here, key dates. That is the September 15th options expiration, call dominated options expiration. Notice when this downtrend began that went through Friday, October 6th. This was the jobs report, non-farm payrolls, and price reversed higher. Then, and then starting last week, really found resistance right around this level here, which last week, this was the upper weekly expected move. So that upper weekly expected move has moved higher, but still that level so far today has continued to act as resistance. All right, let me point out the levels on this chart. So first of all, as I mentioned, the upper weekly expected move has shifted a little bit higher, at least the upper weekly expected move for this week. And that's shown by the dash purple lines. What this is showing is, based on the options market, this is a one standard deviation move for SBX, 68% of the time, SBX is expected to trade within this range between the lower and upper weekly expected move. And then the dash blue lines are showing the lower and upper daily expected move. And note, SBX has been trading around that level. It looks like SBX right now trading just slightly below that level. That's the upper daily expected move, again, based on the options market, one standard deviation move. All right, let me point out the spot gamma levels on this chart. These are proprietary spot gamma levels based on gamma weighted open interest available to spot gamma subscribers. I'm going to point out the key daily levels. First of all, the 4,200 level is the put wall. And the next level above that is the 4,340 volatility trigger that is spot gamma's 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 when market makers are trading with price. On the other hand, above that level, market makers position on the gamma curve is positive. In a positive gamma environment, market makers have to trade against price to hedge their delta exposure. And that tends to subdue or decrease volatility. And note, SBX is trading above that level, but the gamma notional position at the beginning of the day was negative and also more negative than Friday. All right, then finally, the 4,400 level. That is the call wall, the strike with the largest net positive gamma that can be expected to act as resistance. And that is also the absolute gamma strike. That's the strike with the largest absolute net, negative and positive gamma. So 4,400 is a very important level for SPX. All right, there were no shifts in levels for SPX from Friday to today. So all these levels remain the same from Friday. All right, let's take a look at SPX for today just to get a sense of the levels and play for today. I normally show just a one-day chart, but I wanted to point out the level that acted as resistance last week, that was the upper weekly expected move last week, has continued to act as resistance today. All right, let's jump into, well, we'll just take a look at today. So today, the key level in play is the upper daily expected move right here at 4,373. And SPX is trading up and down around that level. Here's the volatility trigger at 4,340. All right, let's take a look at book map. So in book map, I have my own cloud notes. And hello, Gokur, sorry, hello, great to see you, welcome, glad you're here. All right, so sorry about mispronouncing your name. All right, so this is the ES Futures, and I have my own cloud notes, and I have SPX levels. Now, there is a difference in price between ES and SPX, and today it's 30 points. Changes a little bit, but it's around 30 points, so ES minus SPX is 30. So SPX 4,350 is shown at ES 4,380. So the support level for today has been right around this 4,350 level. Again, that's SPX 4,350, large gamma 3 level, and resistance, the 4,37 zero gamma level. All right, so those are the levels in play for today, and here's the upper daily expected move for ES. It's a little bit different than SPX. All right, so those are the levels in play for the S&P 500 today. Shifts and levels for SPX, again, there were none for SPY, the volatility trigger shifted lower down to 432, so not really in play today, and then the call wall shifted higher slightly from 437 to 440. So that is bullish. When the call wall shifts higher, I interpret that as bullish, that is raising that potential ceiling for price. All right, let's take a look at NASDAQ now. We'll take a look at the levels in play. All right, this is the in key futures and book map, and let's take a look at a couple of charts and isolate first QQQ levels. So this is a one day, one minute chart for QQQ, just showing price and key level. So here's the volatility trigger at 367 that did act as support today. And then this 370 absolute gamma strike has acted as resistance. So round number levels, especially the spot gamma levels in QQQ have definitely been in play today. All right, let's take a look at, and just to note the QQQ, the shifts and levels were just the same as SPI. Volatility trigger lower and call wall higher. Call wall from 372 to 380, also bullish. All right, let's take a look at NDX levels, see if there's anything in play for today. So here's NDX, this 15,100 level, L3 level has been in play acting as support, NDX is trading above its volatility trigger at 40, 15,040, and below the call wall, absolute gamma strike at 250. All right, let's go back to NQ futures now. All right, so just like the ES, I have my own cloud notes so I can show QQQ levels. Here's the 370 absolute gamma strike that did act as resistance earlier today. Here's the 15,100 level, and then also the QQQ 367 volatility trigger. So both the NDX and QQQ levels have been in play today for the NASDAQ. So I talked about shifts and levels for QQQ, volatility trigger lower, call wall higher, just like SPI, and for NDX, volatility trigger shifted higher, and the put wall shifted lower. All right, let's take a look at Gamma Notional now to see how market makers were positioned on the Gamma curve at the beginning of the day. So this is Gamma Notional for SPX, SPI, NDX, and QQQ. I normally ignore NDX, and Born Thor says, sounded like God clearing his throat there. Sorry, I put my hand over my microphone. I hope that I was trying to cover that up. So sorry about that. All right, so anyway, Gamma Notional for SPX, SPI, and QQQ, all negative for today, indicating traders are long puts, market makers are short puts, and they have to trade, market makers have to trade with price to hedge their delta exposure. And these numbers did shift more negative from Friday. So shifted down the Gamma curve. All right, thank you, Go Kerr. So again, anytime I have to clear my throat, I'll do my best to mute it. Maybe I can turn my microphone off. All right, so Gamma Notional, negative, more negative than Friday. All right, let's take a look at the Vana model now. And this was a little bit strange to me, the way the Vana model really did not show much of a put Vana effect, but let's take a look at this. So what this chart is showing, this is for SPX, market makers delta notional on the vertical axis, and price on the horizontal axis. There are two curves on this chart. The first light gray curve shows how market makers delta notional changes with changes in price. The purple curve adds implied volatility to the equation. That shows 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 the second order of Greek. All right, let's take a look at price now. So for SPX, the low of the day was right around $43.50. So that's pretty close to the bottom of this curve here, indicating that if SPX was trading way up here, you could always say that this would indicate that market makers are very negative and if price increases and implied volatility drops, market makers can buy back short futures. So the reason this seems a little bit strange to me is because Friday was such a big volatility event. I think VIX was up maybe 20% on Friday. I think traders were concerned about the geopolitical events and buying protection over the weekend. And at the end of the day, traders were buying pretty expensive puts. So I would have expected more of an indication of that in the Vana model. But anyway, let's just take a look and see what VIX has been doing today. So really since about 1.30 on Friday, VIX has been falling and looks like it may have found a floor, let's just zoom in. So this is Friday in the dark shaded area. This is the overnight in the greater shaded area. And this is today in the dark shaded area again and showing that VIX has been falling since again about 1.30 on Friday and maybe has found a floor around 17.4. All right, let's take a quick look at the Vana models for SPI and QQQ. Here's SPI, lower the day, right around 4.34, still pretty close to the bottom of the Vana curve. QQQ, we know, 367, the volatility trigger was lower the day so far, still pretty close to the bottom of the Vana curve. All right, so my thesis for the day was really looking for more of a put Vana rally and higher volatility. All right, let's take a look at some setups. I'm going to start with the SP500. What this chart is showing is price with a white line for SPX and the hero signal with a purple line. Also is hedging impact real time options. This is available from Spot Gamma to Spot Gamma subscribers. It is showing market maker options trades, traders trading options and market maker hedging activity for a combined signal for SPX, SPI, XSP, and ES futures. So if you trade any form of the S&P 500, this is the signal that you want to take a look at. So again, this is showing options trades, market maker hedging activity compared with price. And what this chart is showing is that options traders, at least in the morning, were really not driving price. And there's more of a, really after in the afternoon, more of a correlation between options trades, market maker hedging activity and price action. But in the morning, options traders were really not driving price action. Maybe you could say after 10.30, price finally slowed down and started to move lower as options traders continued to take negative delta positions. So typically when traders take negative delta positions, market makers are taking the opposite side. They're taking positive delta. So they have to sell futures to hedge their delta exposure. Let's just take a closer look and see what traders were doing. So today traders have been buying puts and buying calls. Puts shown with the blue line and this notional value is minus 3.6 billion. They've also been buying calls, but not nearly as aggressively. This number is positive, so they're buying calls, 472 million. So the put buyer is much more aggressive today and so far the has not had that much of an impact. All right, let's, so let's go take a look at the book map now. And I, so really order flow here was much more of a, levels and order flow much more of a clue today as to price action. So I've pointed out the support and resistance levels and just focusing on the RTH, regular trading hours starting at 9.30, this 43.50 level, acting as support. It took a while, ES, S&P 500 broke out of that consolidation, broke higher after the last test of the support level. And as you can see all of the aggressive buyers coming in here, the volume dots are showing market buy, minus sell, a magenta dot indicates more sellers than buyers. A green dot indicates more buyers than sellers. Also the sub chart is showing that large traders were buying with iceberg orders that show by the rising light blue line and also buy stop orders were fueling the move higher that show by the rising yellow line. And then finally the rising dark blue line that's cumulative volume delta, all rising very strong signal for order flow. So there was your long entry, long signal breakout of this consolidation after the final test of the 43.50 and price finally reversed at the 4.37 level. So a couple of ways to play this. First of all, trade this breakout by futures, by shares, by shares, spy calls, sell a put spread. Another way to play this is watching this reaction at the 4.37 level. And you could buy a put spread at that point, kind of a binary trade, like a 4.38, 4.37. You could probably get that for 50 cents. I'll show an example in QQQ as well. Get that for about 50 cents. And as long as spy trades below 4.37 at the end of the day, and I'm talking about a zero DE trade, then you make full profit on that. And note at right at 11 o'clock, as ES reached this spy 4.37 level, all these indicators in the sub chart either turn flat, the blue line and the yellow line for icebergs and stops both flatten out and then cumulative volume delta dropped lower. All right, so that's the S&P 500 set up, both along in the morning, anticipating volatility dropping. So one of the keys today was to watch VIX and also order flow here in book map. All right, Gokur asked, when it goes to right side and gamma model, what happened? Does it really go or I'm sorry, there's something blocking in? Are you talking about the VANA model? All right, so I'm going to assume you're asking about the VANA model. So let's go back and take a look at that. Go to VANA model. So on the right side, let's go back to SBX. So price we're trading, if SBX was trading, let's say up around 44.50, this would be on the positive gamma portion of this curve, 44.50 around here. This would indicate as price goes up, market makers have to sell futures. They always want to remain delta neutral, so they have to sell futures to hedge their delta exposure. Then on the other hand, if price drops from here, market makers can buy back their short hedges. So they're trading, they're buying as price decreases and selling as price increases. And that's in a positive gamma environment. Okay, let's get back to setups. Now let's talk about NASDAQ. NASDAQ, a pretty similar story here. Options traders not really driving price in charge in the morning. This is a combined signal for NDX and QQQ. And again, the most important things today were levels and order flow, at least in the morning. So let's go take a look at book map. Let's go to NASDAQ. So NASDAQ, I've pointed out the key levels today, mainly QQQ levels and also the NDX level. So here is the support, the pullback to 367 after this quick move higher at the cash open and then resistance at the 370 level. So I'm just looking at order flow here. So again, the key was watching these levels, no driving in the morning. Large traders were buying the iceberg orders, buy-stop orders, fueling that move higher as well as aggressive traders. Volume delta, all these lines pretty much rising up until about 10 to 1030, then level off as price levels off. Let's go back to Hero and see what options traders are doing. Zoom in on this. So just like the S&B 500, the correlation really picked up around noon. Traders started taking positive delta positions. Price finally responded. There must have been some news here. I looked in my news feed, I didn't see anything, but that sharp drop, there must have been some news although Hero is showing that in NASDAQ, options traders were a little bit ahead of that and then as price moved back down, they started taking positive delta positions. Let's just take a look at the QQQ chart, zoom in on this. So here's that 370 absolute gamma strike or key gamma strike because it's called here acting as resistance and note QQQ, Hero shows that options traders were fading this move a few minutes before that sharp drop lower at the 370 level. So as QQQ, NASDAQ went up to the 370 level, options traders were a little bit ahead of that and then as price moved back down toward the 367 level, they started taking positive delta positions. So the dip buyers came in pretty quickly and now as price is approaching that 370 level, again, options traders are starting to fade that. Let's go back to book map. So that sharp drop lower was down to VWAP that show them with a blue line here as well as the NDX 15,100 level. Let's just take a look at quick sample trade here. So this is the QQQ trade that I was talking about just showing a very simple put spread. Just a one lot here, one point wide. So as long as QQQ trades below 370 at the end of the day, you make full profit on that. So just a very simple, you know, you can certainly widen this out, do more contracts, just a very simple binary trade assuming that QQQ will stay below the 370 level like it has so far today. And that may not be the case. And note it was more profitable during the day. All right, let's take a look at some stocks now. I'm going to go back to HERO, take a look first at AMD. So bullish day at AMD, let's see what traders were doing. So AMD traders are buying calls and that's mostly driving price action that's shown by the rising orange line. So when traders buy calls, market makers sell the calls and they have to buy stock to hedge their delta exposure. And also the rising, sorry about that, that's nothing I did, have not been able to figure this out and SpotGamma has not been able to figure it out either. But traders continue to take positive delta positions. And again, when traders buy calls, market makers sell the calls and they have to buy stock to hedge their delta exposure. So let's go take a look at BookMap. Here's AMD, not all a big range of movement, 105 is the hedgewall key gamma strike. So price opened above that level and found consolidation around the 107 level. That's most of the volume for today, that's the session volume profile concentrated at that level. Again, the clue for today was traders taking positive delta positions. Let's go back to HERO, all right, the next is Google and I'm just going to focus on the morning here. So traders were buying calls for this reversal hire note the one I really want to focus on is this vertical line in the call signal indicating the large block order institutional order of buying calls and that helps to move price higher. Let's go take a look at Google BookMap. So we know that there was a large block order, large trade or trades right around 950, again not a lot of range in Google, but still a pretty clear signal with HERO there. Right back to the opening print, that's the large magenta volume dot and no point of control remains at that level. So there's Google, looks like it went back and tested that level. Now moving higher again, the next is Microsoft, more range here in Microsoft, let's see what options traders were doing. Very strong correlation between options trades, hedging flow and price action in Microsoft today. Let's shift to puts and calls. So we can see the call buyers were very clearly in charge driving price action. Typically HERO is a much easier read for single stocks than the SMB500 and NASDAQ and certainly today. So it's very clear here that call buyers shown by the rising orange line were driving price and Microsoft, sorry about that. So let's go take a look. So this happened right around 950 as well, the price was started to move higher as traders were buying calls. So let's go take a look at BookMap now on Microsoft and there's that reversal right at 331 as traders started aggressively buying calls and for Microsoft there really no gamma levels in play for today. Let's go back to the total signal and this is something that to watch out for, also a pretty reliable signal is this usually happens a little bit later in the day, 1130 to 1230, something like that. As traders take their foot off the gas and price consolidates or moves lower, in this case for Microsoft price is definitely moving lower as traders take their foot off the gas and again a, excuse me, profitable approach to this is to buy a put spread typically or sell a call spread. The only thing about a single stock is you're trading Friday expiration so that is you're not going to get full profit at the end of the day like you would for Spire QQQ. All right that's Microsoft, one more Tesla, I'm going to zoom in on the morning so this is what I saw in the morning is this Divergent Short. So note the sharp move higher in the morning and options traders were on board with that for a couple of minutes and they started fading that move and then Tesla moved lower that was maybe just two or three minutes later and let's zoom out so options traders took their foot off the gas and Tesla has chopped around until maybe a little bit before 130 and starting to move higher and that looks like now options traders are joining the party moving higher. Let's go to Glue Good Book Map. So Microsoft continues to consolidate so in Tesla here's that reversal lower that I was talking about, sharp move higher, options traders fading that, price versus lower good for about three points in Tesla, then a lot of chop and then there's this move higher just before 130. A lot of aggressive buyers come in, note all the green volume dots all day really, aggressive buyers trying to move price up to 255, let's go back to hero. So the only gamma levels in play for today in the range of this chart not really in play with is the 250 key gamma strike hedgewall in the range of the chart but not in play. All right does anybody have any stocks they want me to take a look at otherwise we'll go back to, we'll start with the SMB500 so I'll go back to the SMB500 so when I zoom in just to show the afternoon session there's a much stronger correlation between hedging flow and price action, all right Netflix and Nvidia, all right so let's go take a look. First of all Netflix we can take a look at hero but I do not have that, I don't have Netflix and Book Map so we'll just have to take a look at hero here and remember Netflix report earnings on Wednesday, see what traders are doing. So they started aggressively buying calls, someone came in right at 1130 with a large block order of calls, sorry about that and it took a while but price really started to move higher just afternoon as traders started buying calls more aggressively, sorry about that. All right so that's Netflix, call buyers driving price, all right Nvidia, then Frank we'll take a look at Apple, let's take a look at Nvidia, kind of a choppy day in Nvidia, very strong correlation between options trades hedging flow and price action, let's see what traders are doing. So for the day they are selling puts shown by the positive notion of value for the blue line and also their buying calls again shown by the positive notion of value, let's go take a look at Book Map, go to Nvidia and remember on Friday all of these large cap tech stocks were really hammered, they were definitely driving the move lower for the NASDAQ and the SAP 500, traders were dumping these stocks on Friday and now it looks like the dip buyers are back in. So here's Nvidia, pretty choppy day and 450 is the key gamma strike, 450 key gamma strike and looks like Nvidia opened around that level and is traded higher as traders have been buying calls and selling puts. All right so there you go there's Nvidia and Netflix, all right Frank wants to take a look at Apple, let's do that, start with Book Map just like AMD and Google not a lot of range today, let's see what options traders are doing, Apple. So traders are buying calls and buying puts, so it looks like in this morning for this move lower, put buyers were in charge, they stopped buying puts, started buying calls, price moved higher, call buyers took their foot off the gas and price consolidated and moved lower. Let's go back to Book Map, all right there you go Frank, not a lot of range in Apple, let's just go back, take one last look at Hero, all right let's go to the SAP 500, we're going to zoom in so we get the afternoon portion here which is showing stronger correlation and you're welcome Frank, let's go, let's look at SPI, so for SPI here's the 437 level, I think it's right on that line, all right so SPI not able to break above that level, let's go take a look at Book Map and again traders, the options traders not doing much, Hero is pretty flat here, let's go to back to Book Map, all right so ES trading down, traded down to the 436 level, let's go take a look at Hero again, all right nothing there, let's take a look at NASDAQ, see if price is crossed above the 370 level and still trying, aggressive buyers coming in, still hammering a hard time getting above 370, let's see what options traders are doing. So in the case of NASDAQ, options traders are definitely taking positive delta positions except for this dip lower, the trend of Hero is still higher, so Hero moving higher, let's go back to Book Map, aggressive buyers shown by the green volume dots as well as cumulative volume delta with the dark blue line, definitely moving higher, although some large traders are coming in with iceberg orders, they used to hide their size, these are sell iceberg orders, that's also shown by the falling light blue line, options traders buying, aggressive buyers buying and large traders are selling with iceberg orders and kind of a toss up here at the previous resistance level at 370, still pretty narrow range for the SMB500, still trading below the 437 level, go back to NASDAQ, check on Hero again, so for NASDAQ, Hero continues to grind higher, not a strong signal, I'm going to separate outputs and calls, so this does provide a little bit more insight, what this is showing is traders starting just after 10 have continued to buy calls pretty steadily, they're buying calls, sorry about that, so they've been steadily buying calls all day in NASDAQ QQ and NDX, show my very straight rising orange line and then around noon they, the put buyers took their foot off the gas, so note the put buyer, the put line has leveled off, so from the cash open until about 12 o'clock, options traders were buying puts that stopped around noon and they have continually been buying calls since about 10 a.m. to 10.20, 10.15, something like that, the book map that looks like that 370 level may be acting as resistance, so NASDAQ still has trouble getting above the 370 level, alright my time is up, not a fantastic trading day today, but anyway, we did see some good setups and tomorrow remember retail sales 8.30 a.m. Eastern time and we'll try it again tomorrow, I want to thank everyone for watching, thanks for your questions and comments and I will see you tomorrow, thanks again, bye.