August 1, 2023 SPX, SPY, ES Trade Plan
7/31 Trading Session Review
An ugly small range on the trading session for the indices. This is a great example of basing and it just felt off when looking at the data last night. Our key levels held while there were a couple of opportunities or what looked like ones to short or long. These types of days will happen and not every day is a clear 40-60pt range day.
I didn’t trade the SPX at all today. Why? I said in the trade plan the expected move is minimal this week considering the big catalysts so it naturally felt like on a day with no catalyst the indices may not move and instead wait on payroll data and key ER’s from AMD/AAPL/AMZN. Over time these things will connect with you as a trader, but it takes time to learn and unfortunately trade through a day like today.
Positive news, we saw some great range and trades in ADBE. There was momentum in this ticker after a pre-market news release on an increased price target. While we gapped up majorly and had a selloff at the open there was a nice opportunity to enter longs at 541 and scalp 9 pts as it reached its target price from our trade plan of 550. You will always see this in gaps…where traders are looking to take profit and price comes down before taking off again.
Again weird day, but not unexpected and why I have complimented my SPX trade plans with other tickers. Some times the indices move and other times they don’t and we hunt for trades in other tickers then.
With that let’s jump into the trade plan.
SPX/SPY/ES Overview (TL;DR)
Bulls need price above 4590 to target 4600 and then 4615. Above 4618 target 4630.
Bears need price below 4580 to target 4560. Below 4560 target 4550. Strong support at these levels.
Between 4580 and 4590 is a no trade zone. I want to see clean breaks and holds for continuation.
ADBE
540-545 is a no trade zone - this is where price is going to determine its direction and come out of balance. Data looks more positive for the bulls as it stands, with negative vanna below spot. Honestly, I would be wary of any shorts on this ticker and instead wait for key breakout levels.
Above 540 or 545 target 555
If there is a breakout of 555 target 575
NVDA
If there was a definition of consolidation today’s action in NVDA was exactly that. It is basically waiting for the AMD earnings report coming Tuesday after market.
Above 470 target 475
If there is a breakout of 475 target 495
Below 462.5 target 455
ENPH
Another earnings and another bear down. This ticker could give some nice technical trades up and down as it determines its next path and how it accumulates at these lows.
If 152.5 (max 150) hold then we can see 160 on this ticker trade.
Above 150 target 160
Above 160 and it holds target 165
For intraday updates please follow me on Twitter @DarkMatterTrade.
News Catalyst
10:00am est - ISM Manufacturing PMI
10:00am est - ISM Manufacturing Prices
10:00am est - JOLTS Job Openings
10:00am est - FOMC Member Goolsbee Speaks
For more information on news events, visit the Economic Calendar
8/1 - SPX/ES/SPY Trade Plan
Bullish bias:
Above 4600 target 4615
If there is a failed breakdown of 4585 target 4600
If there is a breakout of 4618 target 4630
Bearish bias:
Below 4580 target 4560
If there is a breakdown of 4560 target 4550
As always keep an eye on Volland30, VOLD indicator, and the VIX for trend continuation or reversals.
Remember you can use this SPX trade plan to trade ES or SPY. ES value is approx. 26pts more than the SPX levels shared. To get SPY levels simply take the SPX levels and divide by 10.03.
SPX - The Why Behind the Plan
Key Levels
Above Spot:
4590 - positive gamma
4600 - negative vanna
4585-4597 - OB (1hr chart)
4591 midline
4610-4617 - OB (30min chart)
4613 midline
4630 - negative vanna
4665 - negative vanna
4652-4665 - OB (1hr, 2hr chart)
4658 midline
Below Spot:
4585 - negative vanna
4591-4583 - 457.79-456.94 - $6B
4560 - negative vanna
4560 - positive gamma
4564-4543 - FVG (2hr chart)
4560 premium zone
Overnight gap zone
4567-4554 - 455.40-454.10 - $21.64B
4550 - negative vanna
4550 - positive gamma
4530 - negative vanna
4538-4534 - 452.45-452.14 - $15.77B
4529-4520 - OB (30min chart)
4525 midline
4522-4509 - 450.89-449.62 - $14.81B
4500 - positive gamma
4511-4500 - OB (1hr chart)
4506 midline
Dark Pool Levels
We are starting to see dark pool accumulate near the highs of today’s session totaling now approx $6b at this level.
4591-4583 - 457.79-456.94 - $6B
4567-4554 - 455.40-454.10 - $21.64B
4538-4534 - 452.45-452.14 - $15.77B
4522-4509 - 450.89-449.62 - $14.81B
4471 - 445.84 - $3.17B
4453-4438 - 444.02-442.48 - $20.06B
4421-4393 - 440.85-438.06 - $25.11B
4384-4375 - 437.18-436.20 - $24.71B
4349-4344 - 433.65-433.19 - $12.14B
4325-4292 - 431.26-427.92 - $18.46B
I get my dark pool levels from Quant Data.
Orderblocks (OB) and Fair Value Gaps (FVG)
These are smart money concepts and some areas I am looking to see how price reacts. I will give higher credence to OB’s whereas FVG’s could be areas of basing/consolidation if they break. I use Sonarlab’s indicator on Tradingview to plot these.
Resistance levels - at these levels I want to see if price rejects to short or consolidates for a push up. I couple this data with Volland, intraday option flows, and Dark Pool levels. Higher timeframe OB’s or FVG will be harder to break. OB’s are the stronger levels over FVG’s.
4585-4597 - OB (1hr chart)
4591 midline
4610-4617 - OB (30min chart)
4613 midline
4652-4665 - OB (1hr, 2hr chart)
4658 midline
Support levels - at these levels I want to see if price rejects to long or consolidates for a push down. I couple this data with Volland, intraday option flows, and Dark Pool levels. Higher timeframe OB’s or FVG will be harder to break. OB’s are the stronger levels over FVG’s.
4564-4543 - FVG (2hr chart)
4560 premium zone
Overnight gap zone
4529-4520 - OB (30min chart)
4525 midline
4511-4500 - OB (1hr chart)
4506 midline
4498-4493 - OB (15min chart)
4495 midline
4481-4466 - OB (1hr & 2hr chart)
4473 midline
4408-4399 - OB (2hr chart)
4404 midline
Weekly Option Expected Move
SPX’s weekly option expected move is ~53.54 points. SPY’s expected move is ~5.45. That puts us at 4635.78 to the upside and 4528.70 to the downside. For SPY these levels are 462.37 and 451.47.
Remember over 68% of the time price will resolve it self in this range by weeks end.
Volland Data
For a better understanding of the various greeks below I would suggest you visit the Volland YouTube Page. Volland provides unique data showing where dealers are positioned providing in my opinion a higher degree of conviction to where price may move to.
Vanna - Levels where price may repel or act as magnet
Remember for price to go above spot through a magnet or repellent VIX and IV must decrease or stay flat. For price to go below spot through a magnet or repellent VIX and IV must increase.
Positive vanna - will act as magnet
Negative vanna - will act as repellent
When price goes through a positive or negative level it will flip it - ie negative becomes positive and vice versa.
Above Spot:
4600 - negative vanna
4630 - negative vanna
4665 - negative vanna
Below Spot:
4585 - negative vanna
4560 - negative vanna
4550 - negative vanna
4530 - negative vanna
Gamma
Positive Gamma Above Spot - acts as resistance - meaning that dealers want to push against the move
Positive Gamma Below Spot - acts as support - meaning that dealers will want to support price at these levels
Negative Gamma - becomes permissive to price as it moves there - aka neither resistance nor support - simply just chillin and watching what’s happening…
Above Spot:
4590 - positive gamma
4605-4625 - positive gamma
4635-4660 - positive gamma
Below Spot:
4560 - positive gamma
4550 - positive gamma
4500 - positive gamma
Charm
Remember if IV is not expanding Charm will start to overtake Vanna especially 0DTE as it comes closer to expiration.
For all expiry’s, Charm total notional value is bullish - negative is bullish and positive bearish - take the total of the far left and far right values. This is a longer term view of the market and suggests we find key dips to buy to long.
The 0DTE view on SPX Charm shows a bullish trend. Currently, looking at charm we see a GEX paradigm which is a bullish 0DTE study from the Volland group, which suggests price will target 4600 and above that 4610.
Note that 0DTE changes throughout the day and Volland provides updates throughout the day. The futures market can change this paradigm so look for updates prior to market open and then throughout the first hour. Charm while it can provide direction on 0DTE it is most impactful at dealer o’clock - sometime post 1:30-2:00 pm est.
To cover our basis…
Welcome to my Substack where I provide a daily SPX trading plan to help guide my intraday trading. The purpose of this letter is not to advice you on your trading or investment decisions. I am simply documenting my daily trading plan for myself to help with planning and execution. These are simply my opinions and the data sourced from the likes of vol.land, TradingView, Quant Data and others. The stock market is risky, gains are not guaranteed. This is not about getting rich quick, but learn to educate yourself and make the necessary financial decisions on your own. This is not financial advice.