 Hello, everyone. Welcome to Options with Doug. Streaming live daily on Bookmap Discord and the Bookmap YouTube channel at 1.30 p.m. 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. Risk disclosure, trading futures, equities, and options involves substantial risk of loss and is not suitable for all investors. Past performance is not necessarily indicative of future results. The focus of my presentation and the focus of the Options-Dashjug chat channel in Discord is options, order flow, the impact of options markets on stocks and futures, and the influence of market make or 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 at 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. And the second step in my process is real-time as execution. And I look at real-time order flow in Bookmap and real-time market maker hedging flow in SpotGammaHero to confirm my thesis. And just to be clear, I will be talking about setups today and the setups that I will be talking about are in an underlying asset like the S&P 500 futures or NASDAQ futures. Those trades can be taken any number of ways. With futures, with shares, for example, for the S&P 500, with shares of SPY, SPX options, or SPY options, single options, or spread trades. So any number of ways to take the trades, but I will be talking about a setup in an underlying. And questions and comments are welcome. And I will be watching the options-dug chat channel and Discord and the chat and YouTube for your questions and comments. So please post. It will make it more interesting for me as well as hopefully for everybody else. Alright, let's get started. So what I want to talk about today, first of all, news items for today and the rest of the week. Then I'll go through my positional analysis and then I'll talk about setups. So first of all today, whoops, here we go. So there were some news items that came out this morning. And it appears that potentially these economic data releases had some impact on the market around 10 a.m. And that's when the indices NASDAQ and S&P 500 started dropping sharply. So factory orders came in lower than forecast, but better than the previous number. And durable goods, one number was in line and another number was slightly lower than forecast. And then the JOLTS job openings came in less than forecast and less than the previous number. So anyway, that's the data. And that appears to have had some impact on the market that could have been perhaps Janet Yellen, Treasury Secretary's comments about the debt ceiling or a continuation of regional banking issue. I saw that the KRE, the Regional Bank, ETF was down pretty sharply this week. So anyway, that's the data today and price action. And then also today, AMD reports earnings after the market closes. And then tomorrow, PMI, services PMI comes out at 10 a.m. And then of course, the big event of the week, the FOMC announcement at 2 p.m. And then the press conference begins at 2.30. So the announcement will come in the middle of my session tomorrow. And then the press conference begins as I'm wrapping up. And then on Thursday, Apple reports earnings after the close. And then Friday, the employment report is at 8.30 a.m. Eastern time. That's the big employment report that comes out on the first Friday of the month. All right, so those are the news items. Now, let's start with the positional analysis. And we'll take a look at some charts. And this is book map showing the S&P 500 futures ES. And before I look further at this chart, I want to take a look at a larger time frame. And I'm going to take a look at a 20 day one hour chart for SPX. And this is just showing price and key levels. I'll talk about the spot gamma levels in just a moment. Note that I am showing the lower and upper edge of the expected move for the week. And that's the big purple dash line. That's the lower edge. So SPX traded down below the lower edge of the expected move for the week. And then this dash blue line is lower edge of the expected move for the day. And that appears to have had no impact on price action for SPX. SPX sliced below that in the first hour of trade. Actually, that may be the second hour. We'll see that in book map. Or actually on the one day, one minute chart exactly when that happened. So there's the lower edge of the expected move for the day. And now it looks like SPX is trying to recover. And we'll see that options traders in S&P 500 net for all of the S&P 500 instruments have been taking positive delta positions all day. All right, so let's talk about the key spot gamma levels. And these are provided to spot gamma subscribers for a variety of platforms. And again, we're looking at thinkorswim here. There's the put wall at 4000. That's the strike with the largest net negative gamma that can be expected to act as support. And that is also the key gamma strike, the strike with the largest absolute gamma. And here is the volatility trigger at 41.10. And that's spot gamma's proprietary gamma flip level. Below that level, market makers position on the gamma curve is negative. And they have to trade with price to hedge their delta exposure. That tends to enhance or increase volatility. And above that level, market makers position on the gamma curve is positive. And they have to trade against price to hedge their delta exposure in a positive gamma environment. And that tends to subdue or decrease volatility. So now it looks like SPX is trading. It did trade below its volatility trigger, and now is trading above again. And then the call wall is at 4,200. That's the strike with the largest net positive gamma. And that can be expected to act as resistance. So those are the primary daily levels that I follow. The put wall, call wall, volatility trigger, and key gamma strike. So that's SPX, larger timeframe. Showing the key levels that are in play as well as the price action. And now let's take a look at another thinkorswim chart. I'm going to go to a one day, one minute chart. This is again SPX, showing that price did trade below the lower edge of the daily expected move as the 4,150 large gamma two level acted as resistance. That's right here. And then price traded down below 4,100 and the lower edge of the expected move. And also below the volatility trigger. All those levels shown there. And now is trading back above 4,100 and the volatility trigger. All right, so that is the SPX in a one day, one minute chart. Now let's take a look at book, ma'am. And I've got the same level shown on my chart. I've got two columns of notes. These are the spot gamma cloud notes provided to spot gamma subscribers again for a variety of platforms. And I'm showing the same levels on my chart just shifted slightly lower. So spot gamma I believe is using about a 19 point difference between ES and SPX. So these are SPX numbers converted to an equivalent ES number. And I calculated that difference at 17 points. And again, spot gamma is using about 19 points. So there's the 4,100 support level that was noted as support in the spot gamma AM founders note. And there's the volatility trigger at 4,110 and the zero gamma level just above that. And then I'm also showing key spy levels. And there's the 4,14 volatility trigger for spy. And that did act as resistance this morning that final test of that level just as the 10 a.m. data came out and then price dropped sharply after that. So those are the levels that are in play. And we'll talk about this in more detail when I get to setups in just a few minutes. So that is the S&P 500. There's a question in YouTube. Alexis asked, hello, hello. Hi, which options expiration do you use and spot gamma for levels? I use all expirations, typically. I do look at a zero DTE occasionally. But if you're referring to hero, I typically leave that on all expirations. And these gamma levels are based on all expirations. They're based on open interest. So that would be, it's gamma weighted open interest. So that would be all options that are held overnight. And that could be options that expire on Friday or next month or next quarter. All right, so that is the S&P 500. Let's take a look at the NASDAQ. Pretty similar price action. And I'm going to take a look at a, let me grab the QQQ chart. So here's QQQ showing the price action. This is a one day, one minute chart showing the key gamma levels that are in play for today. And here's the put wall down below at 315. Again, the strike with the largest net negative gamma that can be expected to act as support. And then the call wall is at 325. And that's also the key gamma strike. And then the volatility trigger is at 323. So QQQ is trading below its volatility trigger. So for QQQ, market makers position on the gamma curve is negative. And note this 322, large gamma two level, was in play today and acted as resistance. All right, let's take a look at book map now. And here is the 322 level showing my cloud notes columns here. My cloud notes column. And price reversed at the NQ 13,300 as well as the QQQ 322, 322 large gamma level. And that acted as resistance for the NASDAQ. All right, so those are the levels that are in play. And note I'm showing all of the QQQ levels here. And the gamma levels are shown with white and red text. And then the other levels are just shown in yellow. And then I'm also showing the big round numbers, the zeros in the 50s for NQ. And note that NQ did also trade below its lower edge of the expected move for the day. All right, so those are the levels that are in play for today. And now let's talk about shifts in levels. And for the S&P 500, SPS is the volatility trigger. Just shift lower from 4145 to 4110 today. And then for spy, the volatility trigger actually shifted higher from 411 yesterday to 414. And RJ asked, could I look at hero for VIX options? And yes, we'll take a look at that. Good idea. All right, so that is, that's the NASDAQ we're talking about shifts in levels. And for QQQ, all the major key daily levels did shift. Volatility trigger shifted higher from 319 to 323. The put wall shifted higher from 300 to 315. And the call wall actually shifted lower from 330 to 325. And that the key gamma strike shifted higher also to 325. All right, so let's take a look at the gamma charts. And we'll see where those levels come from. We'll start with SPX. These are the absolute gamma levels, again for SPX. Positive gamma, or call gamma, is shown above the zero line with the orange bars. And negative gamma, or put gamma, is shown below the zero line with the blue bars. So this is the SPX 4000 strike. That is the put wall, the strike with the largest net negative gamma, as well as the absolute gamma strike. Strike with the largest absolute gamma. And then the call wall is up at 4200. Again, the strike with the largest net positive gamma can be expected to act as resistance. And then note also the key, the significant amount of gamma at the big round number levels, the 4150 and the 4100. All right, so that's SPX. Let's take a look at SPI. And for SPI, 415 is the key gamma strike. 400 is the put wall, the strike with the largest net negative gamma. And then the call wall at 420. So 400, the put wall being the floor, 420 call wall, ceiling. And gamma also concentrated at the absolute gamma strike at 415. So that is the SP500. I'm going to refresh this page. And we'll take a look at NASDAQ now. And for NASDAQ, 12975 is the strike with the largest net negative gamma. And then the obviously the largest gamma, also the largest call gamma. So that is the key gamma strike as well as the call wall. Now let's take a look at QQQ. So for QQQ, 325 is the key gamma strike. And actually that doesn't look right. Really looks like it should be 320. Let me check something here. Yeah, I got that wrong. Sorry. It should be 320. And that was the same key gamma strike from yesterday. So I just wrote that down wrong. So here we go. There's the 320 key gamma strike or absolute gamma strike. The put wall at 315. And now the call wall at 325. And let's just confirm that. So for QQQ, call wall 325, absolute gamma strike. So those are the key daily levels for QQQ. Put wall 315, call wall 325, absolute gamma strike 320, and the volatility trigger 323. All right, let's take a look at one other thing while we're on this page. I'm going to take a look at the Vantamodel for SPX. And for those of you who've seen this before bear with me, I think this is important. I want to make sure everybody understands this. And this is indicating how market makers positioned in the options market at the beginning of the day, and how they might be expected to hedge as price moves up and down, as well as implied volatility changes. So first of all, this gray curve shows how market makers delta notional shown on the vertical axis will change with price shown on the horizontal axis. So what this is showing is on this side of the curve, market makers delta notional will increase as price rises and they won't have to sell futures to hedge their delta exposure. So that was what I was talking about before. On the positive, when market makers position on the gamma curve is positive, they have to trade against price to hedge their delta exposure. And then this pink curve or pink purple curve adds in implied volatility to that. And that is showing how market makers delta notional changes with changes in implied volatility and price. And that's the van effect, the change in delta with the change in implied volatility. And this is pretty similar in a positive gamma environment, but in a negative gamma environment. Below the volatility trigger, market makers have to, market makers delta notional will increase as price increases or decreases and implied volatility increases. And they have to sell futures to hedge their delta exposure. And again, that's the van effect, the change in delta with a change in implied volatility. And note the shift is about at $41.89. And remember price was trading, SPX was trading down below $41.00 earlier today. And there's the $41.10, that's the $41.10, volatility trigger. And that's probably just based on this more related to the gray curve there. But as implied volatility increases again, that will, I think it certainly had an impact on price action today. And implied volatility, as RJ mentioned, was up sharply. And market makers had to start selling futures to hedge their delta exposure as price dropped and implied volatility increases. So this VANA model definitely came into play today. All right, let's take a look at some data and then we'll wrap up positional analysis and start taking a look at some setups. So here's data that's provided in the spot gamma AM founders note. And I've been focusing on the spot gamma gamma index. And what this is, it's a proprietary measurement of the total amount of market gamma. I used to look at the gamma notional numbers, but those numbers have changed. So I think this is a more consistent view of market makers gamma notional. And these numbers all did shift lower from yesterday. And in a positive gamma environment, again, at the beginning of the day, like is shown here in for the SPX, positive 1.1, this indicates a, again, a positive gamma environment market makers trading against price. And that tends to subdue volatility. And that's what's expected in a positive gamma environment when the spot gamma gamma index is above zero. All right, and note the other numbers. I really just watched primarily the SPX number, I think. That is the most meaningful, but these other numbers are in the positive gamma either slightly positive or slightly negative. All right, let's start with some setups now. And I'm going to go take a look at spot gamma hero and RJ, I'll take a look at VIX after I take a look at the S&P 500. Excuse me, since I already have this up. All right, so this is the hero signal for the S&P 500. For those of you who may not be familiar with this chart, this is from spot gamma. The white line is showing price. And the purple line is showing hero, the hedging impact of real time options. And this is a combined signal for SPX, SPI, XSP, and ES futures. Showing options trades for all these instruments and the resulting market maker hedging activity. And this is, again, a combined signal for all components of the S&P 500 here and showing a very positive number for all components of the S&P 500. And showing a very positive number, positive 3.3 billion. So net for all these instruments, options traders are taking positive delta positions, buying calls and selling puts. So let's see, let's see exactly what they're doing. So they are primarily buying calls that show them by the rising orange line and also selling puts that show them by the slightly rising blue line, but this number is positive, positive notional value, positive delta. And to me, this is pretty puzzling. Traders buying calls on a day like today, but maybe they were taking advantage of the lower volatility at the beginning of the day. But anyway, that is the total signal for the S&P 500, positive delta all day. Now let's take a look at the individual components. And then I'll go back to this chart and look at it in more detail. Right, so first of all, here's the SPX, the first component. And that's a big component of the total signal. Again, positive delta traders taking positive delta positions, even from the open. Let's take a look at SPI, also positive delta. And it looks like that has leveled off around 11.45, 12 o'clock. So that's just SPI. And then let's take a look at ES futures. And as I have observed, since this is fairly new, SpotGama has added ES futures to the total S&P 500 signal. And these guys, traders trading ES options seem to be on the right side of the trade more than the other, more than SPX or SPI. And note this is a negative number, negative notional value here. And let's just see what ES options traders are doing. So they have been selling calls and buying puts. So again, this is just what I have seen and what I have observed in the week or two that this signal has been available is that the ES options traders are on the right side of the trade. And if you're looking for a confirmation or directional confirmation, this might be a good signal to look at. So let's go take a look at the total signal here. And again, if you're looking at HERO again for a confirmation of price, it was not here today in the S&P 500. And again, both these numbers are positive. They were buying calls all day and selling puts. And sometimes that typically does have some influence on price, but it looks like it took two and a half hours up until about noon before 1130 before price really started to turn around. All right, so let's go take a look at book map for the S&P 500 and really order flow. Definitely confirm the move lower. Let's zoom in. From about 930 to 1130, I'm going to tone down the heat map here so we can see price. Make these volume dots a little bit bigger. Let's get the heat map off altogether. So I'm just mainly looking at these levels here. So this is again the 414 Spy 414 Volatility Trigger, this 4150 level that was noted as a pivot in the Spot Gamma AM Founders Note and the lower edge of the expected move. And note the shift in order flow about 10 a.m. to volume delta shown by the pink line shifts lower. And that's pretty obvious just a few minutes after 10 a.m. Note all the big pink dots there, aggressive sellers, market sell orders starting to move price lower, and then the sell stop orders come in. That's shown by the following yellow line in this sub chart as well as this on chart indicator, the red dots there, sell stop orders helping to fuel the move lower, and down below the price traded down below the 4100 level noted as a support in the Spot Gamma AM Founders Note. So hedging flow with Hero was not providing much help. Options traders were fading this move from the beginning and they may be finally getting paid now, but it's painful on the way down. And note also the larger traders with their iceberg orders buying on the way down. And that's pretty typical. Larger traders with iceberg orders they use to hide their size will buy weakness and sell strength. And you can see these large iceberg orders coming in shown by this little blue symbol here, large iceberg orders all the way down. And then finally the options traders and larger traders with their iceberg orders finally start to get paid and price moves higher. And notice how iceberg orders start to level off as price rises. Alright, so that's the S&P 500 I thought that was. Water flow was an easy read this morning, but hedging flow was definitely not. Alright, let's take a look at the NASDAQ now and I'm going to go back to Hero. And actually RJ let's take a look at, we'll take a look at VIX before we go to the NASDAQ. Alright, so there's VIX and let's see what traders were doing. So traders were selling calls and buying puts. And note the negative numbers there. So options traders were betting on a move lower. Alright, so that is the VIX. Now let's take a look at NASDAQ. And I'm going to take a look at the combined signal for QQQ and NDX. That's the NASDAQ signal. Let's zoom in on this. Let's zoom in on the morning here. And this was definitely a much better signal confirmation of the move lower for the NASDAQ versus the S&P 500. And this is one reason that I've started trading NASDAQ more than the S&P 500. I think this is a more reliable signal for NASDAQ. Either QQQ or the combined signal for NASDAQ. Alright, so let's see what these traders were doing. And when we separate out puts and calls, I think this paints even a more clear story here. Showing that traders were buying calls. Shown by this positive notional value here. And also the slightly rising orange line. And they were also buying puts. And this is pretty typical for an index. Traders buying calls and buying puts. And either one or the other is winning. And so today it looks like the put buyers were winning. At least in the morning. So this is what I was looking at. Traders buying NDX and QQQ puts. And price reverse lower. At the NQ 13300 level. That was close to the QQQ 322 large Gamma 2 level. So the move lower in the NASDAQ was confirmed with hedging flow. As well as order flow. So let's go take a look at book map now. I'm going to zoom in. And pretty similar price structure to the S&P 500. Chop around until about 10 a.m. A final test of the here that again the NASDAQ 13300 QQQ 322 large Gamma 2 level. And also VWAP and price moves lower. And this was confirmed by cumulative volume delta falling. And you can just see all the pink dots in there. Aggressive sellers. Their market sell orders. Moving price lower. And just like the S&P 500. Large traders with their iceberg orders were fading the move lower. They were trying to buy weakness. Alright so there's the setup in NASDAQ. And I'll post a more detailed. Annotated chart of this later on. Probably sometime tonight. Alright so great short setup in NASDAQ. I thought this was easier to read than the S&P 500. I was like to see a confirmation with hero to make sure I'm on the right side. With the market makers. Alright let's go back and take a look at. At hero again and see what. What options traders are doing now. Let's go back and take a look at the total signal. The NASDAQ. And it's still bearish. And actually shifted higher. Then this price shifted higher. And the hero shifted lower again. It's now continues to move lower. And let's go back and let's take a look at. NASDAQ now and see what price is doing. So hero is starting to drop pretty sharply. It looks like price is now following. And found resistance at the lower edge of the daily expected move. Wrong tool. And also the 320 level. And again remember 320 is the key gamma strike. Acting as resistance. Here and just before 2pm. Turn break. Final test of the 13200 level. And price is moving lower. Back and take a look at hero. So it took a while to wait for this. For this trade to play out. After a brief move higher. Hero started to shift lower. Oh just after 11am, 11 maybe between 11, 11, 30. Hero started to shift lower. And then price finally found resistance. Again at the lower edge of the expected move for NQ. As well as the QQQ 320 key gamma strike. And let's just take a look at hero for QQQ. And this is the, this makes up the bulk of the total signal here. So pretty similar to the combined signal. And there's the key gamma strike. 320. Alright so that is the NASDAQ. And the SAP 500. Again I thought the SAP 500 was more difficult to trade. Based on a hero signal than the NASDAQ. And let's take a look at some stocks. Start with Apple. And Apple reversed lower. Just after the open. At the 170 key gamma strike. And confirmed by hero moving lower. So take a look at book map. There's Apple. 170 key gamma strike. No little liquidity at that level. That came in actually. Around 945. Price moves up briefly above that level. And does a test of VWAP. And then moves lower. Right at 10am. With the NASDAQ and SAP 500. So the next one is AMD. And note that 90 is the key gamma strike. And again remember AMD reports earnings after the close today. So this 90 key gamma strike was resistance. And let's go take a look at hero now. For AMD. And AMD hero confirmed the price lower. At the 90 key gamma strike. Here's that reversal lower. It's AMD. Let's take a look at Google. Here's Google. Also a confirmation lower. Let's take a look at book map. There's Google sharp drop lower. Right after the open. At the 107 level down to the 104 level. Price is trying to recover. And let's move lower again once confirmed by options traders. Next is Meta. And Meta 240 is the key gamma strike. And that was the target for the move lower this morning. Let's go take a look at hero for Meta. And there's the key gamma strike at 240. That was the target for the move lower. And a strong confirmation with hero. Price moves lower as options traders take negative delta positions. And market makers sell stock to hedge their delta exposure. Let's just see what Meta traders are doing. So mainly puts driving here. So traders were buying puts. And that actually set up a good divergence setup. Zoom in on this. And note that traders were buying puts from the open. Price moves up as traders were initially buying calls. And then as soon as they stopped buying calls, price reverses lower. All right, Kenomoto, that's a pretty lengthy question. Hard for me to read all this and answer during my presentation. I'll give it a quick shot. All right, I'm going to have to take a look at this later. Pause that long to read this question. So thanks for your question. I'll take a look at it as soon as I wrap up here. All right, so there's Meta traders buying puts. Price moves lower. And they continue to take negative delta positions. So let's go take a look at book map again. So there's Meta chopping around the 240 key gamma strike now. All right, the next is Microsoft. And let's see if there are any gamma levels that are in play. We'll take a look at that hero. I don't think there were for Microsoft. No, no gamma levels in play, but definitely a confirmation lower. Options traders taking negative delta positions and price drops. And it looks like hero is shifting lower again. So strong confirmation between hedging flow and price action in Microsoft and the next stock Nvidia. Take a look at hero. And there is hero for Nvidia. I'm going to zoom in on this. So I would, this is a divergence set up. Notice how hero makes a lower high here while price moves up. Setting up this reversal lower just before 10 a.m. Just before the data came out. All right, so let's go take a look at book map again for Nvidia. I'm going to zoom in on that again. So here is the setup. Again, traders were taking negative delta positions as price increased. And note the shift in order flow here. Pricer versus just below the 288 level that price moved above before and then couldn't quite make it up there as traders were taking negative delta positions. And then order flow shifts from bullish green dots, market buy orders up to 288, then shifts negative market sell orders shown by the pink dots, pink volume dots and price moves lower. Order flow shifts bearish and hedging flow was bearish. And just a reminder, when I am trading, I have two screens on this main computer here. And I'm watching hero on one and book map on the other screen. So I don't have to keep jumping back and forth like I'm doing. I'm only presenting on one screen. So that's Nvidia, a very nice, divergent setup confirmed by hero, options trades, hedging activity and also order flow, the shift in order flow to bearish there. And it looks like a primary target down at the 280 liquidity level there if price continues to move lower. Let's take a look at Tesla and bearish day in Tesla. 160 is the key gamma strike in the hedgewall. So there is the 160, again, key gamma strike in hedgewall. That was the target for the move lower in the morning. And it looks like price is heading right down there again. Let's go take a look at hero. There's Tesla and as usual for Tesla, there's a very strong correlation between hedging flow and price action, primarily driven by puts. So initially traders were buying calls, helping to drive price up and then that levels off. And traders were also buying puts. That starts to move price lower. And right now the notional value positive 54 million for calls and negative 106 million for puts. So the put buyers are winning by about a two to one margin for Tesla and prices moving lower. Well, let's take one last look at the index indices. We'll start with the S&P 500. And finally the net for options traders for the S&P 500 has shifted from this constant uptrend to now taking negative delta positions. Let's just take a look at something. I'm going to take a look at what zero DT options traders are doing. And that is not a, that's the total signal 2.7 billion versus 717 billion for the zero DTE shown in the green line there, versus the total all expirations shown by the purple line. So the zero DTE is about a less than a third of the total value there. Actually about a quarter. Let's go back and just take a look at the total signal. So anyway, that's the S&P 500. And then we'll wrap it up and take a look at the NASDAQ signal and go take a look at NASDAQ. So hero for NASDAQ continues lower. Let's go back and take a look at book map. Quick glance at the S&P 500 and continues to try to move higher. Maybe finding support at the 4110 volatility trigger. And here's the NASDAQ. Also potentially finding support at the QQQ 319 level. All right, that's all I have for today. I want to thank you for watching. Thanks for your questions and comments. And tomorrow should be a fun day. Remember, we have data coming out at 10 a.m. PMI data. And then of course the FOMC announcement at 2 p.m. and the press conference at 2.30. So again, thanks for watching. Thanks for your questions and comments. And I will see you tomorrow. Bye.