 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. This disclosure, trading futures, equities, and options involves substantial risk of loss and is not suitable for all investors. Past performance is not necessarily indicative of future results. The focus of my presentation and the focus of the Options-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 market makers and traders 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 the directional bias. The second step of my process is execution, and I look at real-time order flow in Bookmap and real-time market maker hedging flow in Spontagama Hero to confirm my thesis and for setups for entries and exits. Questions and comments are welcome, and I will be watching both the Options-Doug chat channel in Discord and the chat and YouTube, Bookmap YouTube, for your questions and comments, so please feel free to post any questions and comments that you have. All right, my agenda for today. I'm going to go over news items, economic data, and events for today, as well as tomorrow. Then I'll go through my positional analysis, my planning process. Then I'll review a few setups this morning, and during the setup review, I want to talk about something new available in Spontagama that looks like it could be pretty interesting. Then we'll go through the live market. All right, so first of all, news items and events for today. There was quite a bit of data that came out this morning, and along with the release of the F1C Minutes yesterday seemed to contribute to market movement. First of all, and I'm just going to go through this quickly, the US ADP employment report came out at 8.15 a.m., and that was much higher than expected, almost twice the number, actually more than twice the number expected. All right, so that is the ADP report. The next, jobless claims, pretty much in line, and then there was a Fed Speaker this morning indicating, basically, he's looking for more rate hikes. So that's FOMC member Logan, and then US Services PMI came out at 9.45, that was greater than expected, also higher than previous, and then finally, the JOLTS report seemed to be in line. So a lot of data, most of it either in line or better than expected. All right, let's, oh, and Friday, tomorrow morning, the employment report comes out at 8.30 a.m. Eastern time, and that could definitely be a market mover. All right, so that should wrap up the week, the employment report tomorrow. All right, let's take a look at some charts. We'll go through my positional analysis now. And this is the book map chart for ES Futures. Hello, Carba FX, glad you're here. All right, so book map chart for ES Futures, and we'll cover setups a little bit later. I'm just going to go through my, go through the levels planning process for today. So far, so I want to start with a larger time frame. This is SPX in a 30-day one-hour chart, and let me point out some levels on this chart. Again, this is SPX, 30-day one-hour chart, and thinkorswim. First of all, I have the lower and upper daily expected move, so that's for the day. And note that SPX did gap down below that lower, below the lower daily expected move, and is still trading well below that level. The next levels, the dash purple lines, showing the lower and upper weekly expected move. So SPX traded below that upper week, lower weekly expected move earlier today, and is now trading above that level. There are also some spot gamma levels on this chart that I want to point out. First of all, the put wall at 4,200, that's the strike with the largest net negative gamma that can be expected to act as support, and that is not in play for today. The next level up, actually next levels, first is the volatility trigger at 4,395, 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. And when we look at the Vana model, we'll see an example of that. Also, when we look at the look at setups for this morning, the short setup. All right, the next level up is 4,400, that is a huge gamma level. That is the absolute gamma level, that's the strike with the largest net absolute gamma. And by the way, the volatility trigger now, SPX is trading above that back in a positive gamma environment, in a positive gamma environment, market makers have to trade against price to hedge their delta exposure, and that tends to subdue volatility. And then finally, and note also, these two levels line up with the lower weekly expected move, all around about 4,395 to 4,400 level. And then finally, there's the call wall that also is close to the upper weekly expected move at 4,500. And that is the strike with the largest net positive gamma. And that can be expected to act as resistance. So those are the levels in range, potentially for the next few days. All right, let's take a look at another thinkorswim chart. And this is a one day one minute chart for SPX. And here is the zero gamma level at 4,388. And around that level, it appears to have acted somewhat as support. Here's the volatility trigger at 4,395. Now SPX is trading above that level and heading back toward the lower daily expected move at 4,426. All right, Noah asked, very curious about your analysis of the bounce level this morning. Stop ESU3CME by 276. I closed my short way too early. Okay, we'll take a look at that in a few minutes. When I talk about setups, and I assume you're talking about the S&P 500. So we will take a look at that. All right, so let's take a look at book map now. So we know that SPX is trading back above the volatility trigger. So here's book map. And I have my column of cloud notes here. This is what I'm using. This is spot gamma cloud notes. And these notes are not updated to the current ES to SPX difference, which is 35 points around 34.5, 35 points this morning. So I'm showing the SPX levels. There's the 4,400 level absolute gamma strike. You can't see it here. But that white bar just above 438 there is the volatility trigger at 4395. And then there is the 4388 zero gamma level. I also have SPI levels shown here. So here's the SPI 440 absolute gamma strike. And note the SPI levels have been in play 439, 438, 437, which I believe the 437 level was closer to support. All right, so those are the levels that are in play. Again, we'll talk about setups in a few minutes for the S&P 500. Shifts in levels. For the SPX, there were no shifts in levels. Volatility trigger put wall, call wall, and absolute gamma strike all remain at the same levels from yesterday. And for SPI, the call wall did shift lower from 450 yesterday to 445 today. So the ceiling, the potential upside for SPI has moved lower from 450 to 445. And I interpret that as somewhat bearish. All right, let's take a look at NASDAQ. And for NASDAQ, I'm going to take a look at a QQQ chart. This is a one day, one minute chart showing the levels in play for today. Note that QQQ is trading below its volatility trigger. It's in a negative gamma environment. And just around this 365 level has acted somewhat of support this morning. All right, so those are the levels in play for today for QQQ. And note for QQQ, the call wall did shift lower as well from 375 yesterday to 372 today. And for NASDAQ, I have my own cloud notes as well. So I'm showing NDX levels there. Excuse me, NDX levels. There's the lower daily expected move. And just around 830, let's see what time that was before the cash open, 830. NASDAQ moved below the lower daily expected move. And here's that 365 level and also the NDX 15,000 level. So to me, this was not as easy a read as the S&P 500 today. Anyway, so those are the levels that are in play for today for NASDAQ. All right, let me check for questions. All right, so Drew asks, are your vol levels and triggers from Spot Gamma daily? Yes, so the gamma levels, anything shown with the white label and the white line on my chart are from Spot Gamma. Now the, if you mean vol levels, if you mean the lower and daily upper expected move, no, I just get that from an options chain and think or swim. So the white labels are from Spot Gamma. And I update them in my own cloud notes. So same for the S&P 500. Again, 440 absolute gamma strike, that is from Spot Gamma. And I prefer to keep my own cloud notes so I can see all of these levels together. All right, so shifts and levels I've talked about for QQQ, the call wall shifted lower. All right, let's take a look at some additional information that I use in my planning process. And this is the Spot Gamma Vana model for SPX. And I think this is important information to look at every day to understand how market makers may be reacting with changes in price and applied volatility. So what this chart is showing is market makers delta notional on the vertical axis and price on the horizontal axis. There are two curves on this chart. The first, this gray line, is showing how market makers delta notional changes with changes in price only. So what this is showing is if price increases, market makers will have to sell futures to hedge their delta exposure. That's typical of a positive gamma environment. They're trading against price. Remember, market makers always want to remain delta neutral. So as their delta notional changes, they buy and sell futures to hedge their delta exposure. And the other curve on this chart, the purple curve, adds implied volatility to the equation. And that is showing how market makers delta notional changes with changes in price and implied volatility. And that's the Vana effect, the change in delta with a change in implied volatility. Hence the name of this, the Vana model. So what this curve is showing is if price increases, market makers will have slightly less delta notional to hedge as predicted by the delta only curve, the gray curve. On the other hand, as price decreases, market makers will have significantly more delta to hedge as predicted by the gray curve only, the delta curve only. So that was the case this morning. Let's take a look at, just want to see where SPX is trading now. Give me just a moment. So right now, SPX is trading right around 4410. So right around where I'm holding my cursor now, this vertical line, that's 4409. And remember, SPX traded down below 4388 this morning. So this is negative gamma environment, just to the right of that red arrow there. So what this is showing is price was falling this morning. Market makers were selling futures. And that tends to accelerate the move, add fuel to the move. Market makers implied volatility was increasing. And market makers delta notional was increasing. They had to sell futures to hedge their delta exposure. And then when price reversed, just the opposite. That's the put VANA effect. As price was increasing, implied volatility started to decrease. And that was about 1130. Let's take a look at a VIX chart. So right here, just about 1130, there was a sharp drop in VIX. So implied volatility dropping, price starts to increase. And market makers can buy back their short futures. Their delta notional is decreasing with that drop in implied volatility and the increase in price. So that's why I think it's so important to understand how market makers are positioned at the beginning of the day. And how they can be expected to react with changes in price and implied volatility. So on this left portion of the curve here, they are trading with price in both directions. As price moves down, they're selling futures. And as price moves up, they can buy back their short futures. And that tends to, again, increase volatility. All right, let's take a quick look at VANA model for SPY. And for SPY, for SBX, first of all, gamma notional at the beginning of the day, once positive. For SPY, slightly negative. I've got SPY trading at around 439 now. So still on the left portion of the VANA model here. And remember, SPY traded down to about 437 today. So again, the same effect as the SPX VANA model. Market makers trading with price this morning. And then finally, let's take a quick look at QQQ. So QQQ right now trading around 367. So again, for QQQ on the negative portion, negative gamma portion of this curve. All right, let's take a look at some data and see how market makers were positioned at the beginning of the day. I'm going to look at gamma notional here. For SPX, SPY, NDX, and QQQ. So note, now these numbers did all decrease from yesterday. So SPX gamma notional still positive at the beginning of the day, but less positive than yesterday. SPY shifted from positive yesterday to slightly negative today. And then QQQ gamma notional became less positive today. So Drew asked, can you chart VANA curve on ES or only SPX and SPY? Only, let's go back to, so the VANA model is only available for these instruments. So this is one I focus on. For example, for the S&P 500, the base index, the original index is SPX. And ES is just a derivative of SPX. So my thinking, the way I approach this is options trades and market maker hedging activity are a large driver of price in ES. So when traders buy and sell SPX and SPY options, market makers are hedging those trades with ES futures. So SPX is the primary index. SPY is really a derivative of that, approximately one-tenth. And ES is a derivative as well. So these are the indexes that have a VANA model available on spot gamma. All right, let's take a look at some setups. So I'm going to start with the hero model, hero signal for the S&P 500. So what this chart is showing is price with the white line for SPX. And the hero signal hedging impact real-time options for the S&P 500. This is a combined signal for SPX, SPY, XSP, and ES futures, all under one combined signal showing options trades and those instruments and market maker hedging flow. Let's take a look at the individual components of this. And then I'll take a closer look at this chart. So first of all, SPX, well, let's take a look at the notional value here. That's shown by this purple number here and so far minus 1.8 billion. That's the notional value of options trades so far today for those instruments. There's SPX minus 525 billion. SPY, right now it is slightly positive for the day, but started going in the opposite direction of price right around noon. So starting around noon, 12 p.m., 12.15, SPY options traders started taking negative delta positions and then finally ES futures and that's minus 1.3 billion. Let's go to the total signal now. We'll zoom in on this. So really there are two primary setups here and the first was short in the morning as options traders were taking negative delta positions and price responded lower. All right, so that's the first setup and obviously the second setup is long, starting around 11.30. So let's go to book map. First of all, we'll focus on the short setup. Back to book map, go to ES and zoom in here. So again, remember Hero was showing that options traders were taking negative delta positions and let's just, we'll go back and see what they're doing and Hero first so we can be a little bit more specific. So this morning they were buying puts and buying calls. Let's just zoom in on this. So in the morning they were buying puts and buying calls. The orange number that's showing call buys, call buyers, positive delta, but the put buyers, there were more puts almost 3 billion minus 3 billion. Traders were buying puts when traders buy puts, market makers sell the puts and they have to sell futures to hedge their delta exposure. So we know that traders were buying puts, market makers were selling the puts, selling futures and we also know that cumulative volume delta was falling, that's shown by the pink line there and then also sell stop orders will helping to fuel the move lower and there were some really good pullback entries to spy levels. First of all, the spy 439 level, a couple of pullbacks to that level and then another pullback to the spy 438 level made for good short entries and there were also a number of other pullback entries. All right so that's the short setup this morning, pretty easy read just based on the clear confirmation shown by HERO by options traders as well as the sell stops helping to fuel the move lower as well as aggressive sellers. Let's take a look now at this reversal hire and remember the VANA model as and we saw VIX started to drop pretty sharply right around 1130. Options traders started taking positive delta positions. All right so Drew asked, can the HERO chart show the deviation between call and put volume from zero line open to show which is stronger? Yes so you can, that's what I did. Let's go back to the HERO chart, need to take a look at that in any way. So I scroll back so ES options and SPX options start to trade before the cash open. So I scroll back, this is 930 right here, this is the cash open. So I scrolled this chart to show pretty much the cash open till about 1130. So I'm showing cumulative delta data from it's showing really the earlier trades which are not significant showing pretty much from the cash open but you can show that information from anytime you want until about 1130. So I see now up to this point in the day the notional value for puts at about minus 3 billion and versus calls at about 686 million positive. So yeah I can just scroll on this chart left and right and see data for whatever time period I want to take a look at. All right so that was the short setup this morning. Now let's, I'm going to go back to the total signal and note the sharp reversal here. Note not really much of a lead effect, just about 1125 right here. Price reverse is higher, trader start taking positive delta positions could very well be taking profits on their puts but anyway price starts to increase in a very very mechanical fashion just straight line right up until about 125 and that's when hero starts to shift lower. So we'll go let's take a look now and see what traders were doing from about 1125, 1120. So they're still buying calls and still buying puts. Put number is higher but price did reverse at 1130. All right let's go take a look at book map again. So note the very mechanical straight line nature of this move higher. So I would imagine for the for you SpotGam subscribers there may be a more detailed description of what was happening. You know all I know is I can read hedging flow and order flow and just one thing to point out there were some large traders coming in. Oh starting really about 945. So larger traders that's shown by this rising light blue line those are iceberg orders. Those are orders that use, these are orders that larger traders use to hide their size. So very large iceberg orders. Let's zoom in on this and see if we can see this. So this is kind of a precursor to the move higher and this is pretty typical of larger traders. They will sell strength and buy weakness. So here they were definitely definitely buying weakness. So I'm looking at the light blue line on the sub chart and traders started buying on the way down with large iceberg orders. There's execution for 3,000 contracts there. Another 3,000. There's over 4,400 there. So large traders were in as price moved down buying with iceberg orders. So there's the first clue that there could be a reversal coming up and then price finally reverses. Remember we're seeing hero rising. Traders start taking positive delta positions on net. VIX is dropping and keeping the Vano model mined. We know that as VIX drops price rises market makers can start to buy back their short hedges. All in a kind of a feedback loop starting to drive price higher. All right. So there was the short setup this morning and then the reversal higher around 1130. That's going to be my primarily primary focus for the indices this morning. I thought the ES was much easier read than NASDAQ today and that's been pretty typical. So let's just go, we'll take a quick look at hero for NASDAQ. And this is the hero signal for NASDAQ, the combined signal NDX and QQQ. Really not much of a confirmation here. Pretty stark difference between the hero signal for the SMB500. Very strong confirmation and not so much for NASDAQ. So let's go back. We'll just take a look at order flow for NASDAQ. And here for NASDAQ just the opposite of the SMB500, larger traders were selling with iceberg orders using iceberg orders to hide their size and falling sell stop orders also fueling the move lower as well as aggressive sellers shown by the cumulative volume delta there. And then this rising cumulative volume delta was a clue for the reversal higher. But again, I thought much easier read in the SMB500 except for what I'm going to show now. All right, so let's that's the setups for the SB500 NASDAQ. Now let's take a look at go back to hero. So what I want to focus on today is something new that's available in spot damn I believe it just came out yesterday. And I could not find any information on the support side or you know, I expect Brent to talk about it sometime soon. What I want to point out are these alerts. So Spunt Gamma introduced call wall input wall breach alerts a couple of months ago. And I don't think this is right. SBX call wall breached at 934 AM. But anyway, that they introduced these call wall and put wall breach alerts a couple of months ago, talked about volatility alerts. And a couple of months ago as well. And it looks like introduced them yesterday. So yesterday I noticed there were a large number of alerts. And so I looked at it after the close yesterday and started to notice these alerts, the volatility alerts. No information so far. So I assume that green means it's a bullish alert and red means it's a bearish alert. So I'm going to go through three of these and I just picked out I was watching Tesla, QQQ and Nvidia this morning. And these alerts came out. So let's go to Tesla. So when you click on the alert, it takes you to that time. So 957. This is about the time of the alert. So it appears to be noting a divergence. So note that hero starts to rise just a minute or two before before price. So that's 957 for Tesla. And I'm going to go through three of these. So we know that there was a divergence. Hero started to rise continues to rise. And it took a while for a few minutes for Tesla price to respond. So let's go to book map. I'm going to go to Tesla. And I've marked these on the chart. So this first green rectangle here is the around 957 when that alert came out. So again, I haven't heard Brent talk about this lately. I don't have any information. But the way I interpret this, this draws my attention to Tesla for a potential reversal. It doesn't mean click the buy button right now. It means you could should watch Tesla and watch the order flow and see how it reacts. So this was a good, good signal for a long, long setup. So watching the first signal at 957, there was another pullback almost to 273. And then several more pullbacks that were good for long entries. And one more pullback here. So that signal worked out pretty well. All right, let's go back to, go back to hero now. And again, this is new. And I'm just just really experimenting with this, you know, looking at it for the first time. So note, this is the reversal here. Just before 10am, options traders start taking positive delta positions. That really continues to increase until about 12 o'clock, 12, 15, something like that. As price approaches the 280 key gamma strike, we'll just zoom in on this. So there's the whole day so far. We'll zoom in on the morning a little bit. So at that time, there's 957, traders start buying calls that shown by the rising orange line and they were also selling puts, shown by the rising blue line. All right, so that was the first signal. Now let's go to QQQ, the next signal. Click on it, that takes me to the point of the alert. It was at 9.59 right there. So this is showing again a little bit of a divergence. Hero starts to rise, setting up a divergence. Let's go take a look at book map, go to QQQ. So there's the setup in QQQ. I marked it with this green rectangle again, right here. So that set up a good initial long for about a point from 365 up to 366. Price moved lower again, reverse back to 365 and there was the better setup and price still continues higher after that setup. The second test of 365. All right, let's go take a look at hero and we'll take a look at what happened after that time. We'll zoom out. So from that point, I think that was about right here. Price moved higher, went back down, moved up and really didn't reverse higher until about 1130 and at that point hero had leveled off. So I thought this setup in Tesla was better but the first QQQ was good for at least a short scalp from 365 to 366 and of course you could take that in NQ as well. Then finally let's take a look at the NVIDIA alert and that was at 10.01. So that really does not look like a divergence, just more of a confirmation 10.01. And again, at this point I'm not quite sure what the basis of this is. I'm just watching this, observing this. So there at 10.01, there was the signal but we know that hero is rising at this point, continuing to rise. All right, so let's go take a look at NVIDIA in book map. So again, I have marked the setup with these green rectangles. So here's the first at the time of the alert. So that was definitely a great long setup pullback to 415. Then there was another pullback later on. So these initial entries were good for three or four points up to 418. Then another pullback and now price continues up past 420. All right, let's zoom in and look at the entire day. So from that point of the alert, that was pretty clearly the lower the day. And from that point, hero has continued to rise, not in a straight line, not like the S&B 500, more choppy, more deeper pullbacks for entries for long entries. So note at that point, the time of the alert, traders were buying puts and that completely stopped. So they stopped buying puts. Note that line levels off right now at about 120 million, minus 120 million, but that line at 10 a.m. basically just shut. Trader stopped buying puts and they resumed buying calls. And that activity has really continued throughout the day. Now maybe leveling off a bit. So far, I think I have a pretty good reaction to this. This has led to three pretty good setups. I think the stocks, Tesla and Nvidia were a little bit better than QQQ. Let's just go back to book mount. So for Nvidia, it looks like the alert pretty much nailed the lower the day and pretty close for Tesla as well. Again, pretty much nailed the lower the day. All right, so Sam Pan asked, when orange line goes up, that equals call buying. So the direction of the line indicates delta. So a rising line indicates positive delta. So for calls, the orange line that is indicating call buying. That's a positive delta position. When traders buy calls, market makers sell the calls and they have to buy stock to hedge their delta exposure. All right, so when the blue line goes up, that's positive delta, that's puts. So selling puts is a positive delta position. So rising line, orange line traders buying calls and selling puts, rising blue line, falling lines indicate traders are selling calls, rising, falling orange line and then a falling blue line indicates traders are buying puts. So think of the direction of the lines in terms of delta. All right, let's take a look at the live market now. Let's go back to, we'll go back to hero. And there have not been any signals after this meta signal at 1122. We can just take a quick look at that. So that was not, if that was bullish, that was not a very good signal. All right, let's take a look at the S&P 500. And hero has definitely shifted lower, starting just around 125, 130. Now moving lower, let's go take a look at the S&P 500, see what it's doing. Go to book map. So we know that traders are starting to take negative delta positions again. And this mechanical rise just up to maybe 44 or 45 is slowing down. Larger traders have been selling this move. So we know that options traders are either taking profits or starting to take negative delta positions. And then larger traders started selling strength, really around 1230, shown by the falling light blue line that's shown by this, these pink numbers here with this, I don't know, kind of a squiggly icon there. Larger traders in now selling with iceberg orders. Options traders starting to take negative delta positions and price may be starting to roll over as the S&P 500 approaches the spy 440 absolute gamma strike. Let's take a look at NASDAQ. So NASDAQ has slowed down as well. Let's go take a look at hero for NASDAQ. And NASDAQ hero really started to move lower about 1230. So around 1230, options traders started taking negative delta positions in NASDAQ. You can take a look at book map. I'll stick with the S&P 500. There's been much more, for me, much more clarity today. So again, we know that options traders taking negative delta positions larger traders have been selling iceberg orders. And now it looks like cumulative volume delta. The pink line is starting to roll over. And they're no longer any by stop orders helping to fuel the move higher. So this is starting to look bearish. Right, I've got my time is actually up. Does anybody I can take a minute or two to look at stocks? Does anybody have any other stocks they want me to take a look at? All right, I'm going to wrap it up. I don't see any requests for any stocks. I want to thank you for watching. Thanks for your questions and comments. And remember tomorrow at 8 30 a.m. Eastern time, the employment report comes out. And that most likely will be a big market mover. So we'll talk about it tomorrow afternoon. All right. Thanks, everyone. Have a great afternoon. Thanks for watching. And I will see you tomorrow.