March 30, 2023 SPX, SPY, ES Trade Plan

Yellen & Kashkari Await Us

Good evening/day/morning traders. Yesterday was fun…while we provide both a bullish and bearish bias it just feels a lot better when stocks are green. Shorting can be profitable, but is that really fun and best for the market/country?

Last session trading recap

The calls I held overnight paid off pretty nicely. I ended the day about $5,000 in profit holding SPX and SPY calls. I explained in yesterday’s trade plan why I took the trade and suggest you review it for future trades.

March 29, 2023 SPX, SPY, ES Trade Plan

The trade plan was all about bullish bias and one failed breakdown…We hit nearly every one of our price targets and if you traded futures you joined in on much of the ride alongside with me. Here was our ideas:

• Above 3980 target 4000

• If there is a breakout of 4000 target 4015

• If there is a breakout of 4015-20 target 4030

When I sent the trade plan yesterday we were right at 3990 (4020 ES levels) and could have sniped 10pts like that and left runners pretty much until the morning and then traded the failed breakdown of 4000 back to 4030. Insane how awesome these trade plans are.

Dark Matter @DarkMatterTrade

$5K profit on the day...if you didn't swing you still got paid and if you are an $ES trader you ate overnight. All 3 trade ideas hit - Above 3980 target 4000 - If there is a breakout of 4000 target 4015 - If there is a breakout of 4015-20 target 4030 $TSLA $SPX

Dark Matter @DarkMatterTrade

Boom...as mentioned in our $SPX $ES $SPY trade plan I had calls I held overnight and they paid off today... Over $5k in profits on the accounts swinging $SPX and $SPY calls. I am out and will now be looking for the break of 4015 for any continued upside. Should we break down… https://t.co/GC4cis3oMm https://t.co/eAmRPFXMaF

Personally since I have started these trade plans back in February these two months have been my most profitable and most consistent months. Trust me I have learned and lost a lot to these markets. Time and #paytience are key to a trader and handling the emotions.

I am going to assess over the weekend whether we move the trade plans to a subscription of $10/month. The trade plan consumes a lot of time and I have shared here how having a plan and KNOWING why levels are more important than others is so critical to your edge and confidence as a trader.

Some of you have already pledged and for that we say thank you. Once we enable subscriptions those will kick in, but for those who haven’t yet I would suggest that you pledge now. Curious to hear from you on whether you will continue the journey with us.

Remember…Stay #paytient, compound, the gains will ultimately come. Put in the work, prepare, and it will pay off.

I enjoy interacting and learning from other traders so continue to share your trades, ideas, and how you use this trade plan by messaging me on Twitter @DarkMatterTrade.

News Catalyst

Fun day of catalysts…

1. 8:30am est - Final GDP

2. 8:30am est - Unemployment Claims

3. 1:00pm est - FOMC Member Kashkari Speaks

Kashkari is one of the more hawkish FOMC members - what he says could have weight on what the market does

For more information on news events, visit the Economic Calendar

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SPX/ES/SPY Trade Plan

Remember you can use this SPX trade plan to trade ES or SPY. ES values are approx. 30pts more than the SPX levels shared below.

Bullish bias:

1. Above 4035 target 4050

2. If there is a breakout of 4060 target 4075

3. If there is a failed breakdown of 4000 target 4025

Bearish bias:

1. Below 4030 target 4005

2. If there is a failed breakout of 4050 target 4030

3. If there is a breakdown of 3995 target 3950

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SPX - The Why Behind the Plan

Key Levels

Alright, let’s take a bit of time to clean up our key levels…

3970-50 is a critical zone for the bulls to hold. This zone has been hammered with dark pools all week and this zone has acted as a major support zone where price has reversed from.

4000 continues to be a key level for the bulls to hold and continue their fight…if it holds we start our push towards 4050 then 4065.

The trendline from the high of February was breached and we closed above it. This is a key trendline if broken could take us back towards 3900 (not 0DTE)…

SPX Trendline from the lows of March 2023. It has been tested 6 times and has kept the SPX supportive each time. We also have the downtrend line acting as resistance since February’s high which was breached today…

Below Spot:

1. 3950-70 - key dark pool level

   1. 3950 - negative vanna

2. 4000 - LVN from 3/29 Gap Up and 2/27 weekly VAH

3. 4017 - March’s VAH

Above Spot:

1. 3996-4031 - bearish OB (1HR chart)

2. 4044-4052 - OB (2HR chart)

3. 4052-4067 - FVG (1HR & 2HR chart)

   1. 4054 - February’s VAL

   2. 4055 - negative vanna

4. 4080 - negative vanna

Dark Pool Levels

We need to pay attention to some key levels that have Dark Pool buildup. Mark them on your chart as key levels that we should pay attention to. Note I combine my dark pool analysis from multiple sources as I don’t get a clear picture from just one always - for this I use Quant Data and Tradytics.

1. 3950-70 - (395.62) - Over $8B has been printed at this zone

   1. $3B was reported on Friday

   2. $1.5B was reported on Monday

   3. $1B was reported Tuesday

   4. $2.6B was reported Wednesday

2. 3940-45 - (393.40) $1.81B was reported on Friday

3. 3910-15 - (390.11) a key dark pool level that kept the market supportive

I like the below chart view from Tradytics and will keep a view of it from the previous day so we can monitor the changes to the levels…

3/29 SPY Darkpool Levels

3/28 SPY Darkpool Levels

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.

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.

1. 4039-4044- FVG (1HR chart)

2. 4044-4052 - OB (2HR chart)

3. 4052-4067 - FVG (1HR & 2HR chart)

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.

1. 4022-4018 - FVG (2HR chart)

2. 4007-3972 - FVG (2HR chart)

3. 3967-3950 - OB (2HR chart)

Volume Profile

Let’s review the volume profile and some key levels there. If you are unfamiliar with the Volume Profile I highly suggest reviewing some YouTube videos or reading this quick overview on it.

Some keywords to be aware of:

• VAH = value area high

• VAL = value area low

• POC = point of control

For a more detailed view see the trade plan from 3/28. This is our latest analysis of the volume profile:

• We are out of balance on the weekly profile and the VAH of this week sits at 4006

• The price of SPX closed right on the 2/21 VAH - 4028

• Above us we have the 3/6 VAH that sits at 4036

• A LVN was created above the 3/6 POC - 3986 - and 2/27 VAH - 4000

• The monthly VAH sits at 4017 - price is currently out of balance

March 28, 2023 SPX, SPY, ES Trade Plan

Weekly Option Expected Move

SPX’s weekly option expected move is ~84.66 points. SPY’s expected move is ~9.15. Remember over 68% of the time price will resolve it self in this range by weeks end.

SPX’s Weekly Option Expected Move for Week of 3/27

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VIX Update

Let’s review the VIX chart. VIX continued it’s selloff majorly today, but it did hold a key OB and area of “demand” for it. The VIX is at a key critical juncture and any further good news could crush the VIX some more. This one is on the watch for sure…

We are also testing a trendline from February where the VIX has bounced from multiple times…

Key levels…

Above Spot:

1. 19.55-19.93

2. 20.43-21.07

3. 24.36-26.09

Below Spot:

1. 19.27-18.89

2. 18.72-18.61

3. 16.03-15.43

4. 15.43-14.97

Key VIX Levels

Remember, typically VIX going down correlates with a uptrend in the market and vice versa for a downtrend in the market.

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Vol.land 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.

As we are in a window of weakness with Vanna so we cannot solely rely on these levels. It is imperative that for the next two weeks we look at key Gamma levels, orderblocks, dark pools and the VIX.

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:

1. 4030-4050 - positive vanna’s

2. 4055 - negative vanna

3. 4060-4075 - positive vanna

4. 4080 - negative vanna

Below Spot:

1. 4025-4005 - positive vanna

2. 4000 - negative vanna

3. 3995-3955 - positive vanna

4. 3950 - negative vanna

Aggregate Vanna data from Volland

Gamma and Delta-Adjusted Gamma (DAG)

Positive Gamma Above Spot - acts as resistance

Positive Gamma Below Spot - acts as support

Above Spot:

1. 4030 - positive Gamma

2. 4030-4050 - positive Gamma

3. 4060-4075 - positive Gamma

4. Dealers must buy between 4000-3995

Below Spot:

1. 4000 - positive Gamma

2. 3975 - positive Gamma

3. 3950 - positive Gamma

4. 3925 - positive Gamma

5. Dealers must sell above 4005

Aggregate Gamma data from Volland

Dealer buying vs selling pressure - positive notional value = buying - negative notional value = selling

Charm

While Charm is on “vacation” I will continue to share the data just for observation purposes.

Charm is negative on SPX. This suggests that Charm will have little a more bullish impact on SPX.

SPX Charm Notional Total Value shows more negative total notional value - bullish signal

When reviewing Charm we also need to account for SPY’s charm. It is leaning neutral.

SPY Charm Notional Total Value shows neutral Charm

Between the totals of SPY and SPX, SPX charm will outweigh SPY. When they are in sync that further adds to the charm impact. Keep in mind the total notional value of SPX should be multiplied by 10 for comparison to SPY.

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Final Take

After an incredible move yesterday I would expect some consolidation and potential selloff, but don’t have just a bearish bias. We could see 4065 if we break 4030. There is data before the opening and FED speakers throughout the day.

Remember these key levels in the event we do have a kangaroo market…levels with the why…

Below Spot:

1. 3950-70 - key dark pool level

   1. 3950 - negative vanna

2. 4000 - LVN from 3/29 Gap Up and 2/27 weekly VAH

3. 4017 - March’s VAH

Above Spot:

1. 3996-4031 - bearish OB (1HR chart)

2. 4044-4052 - OB (2HR chart)

3. 4052-4067 - FVG (1HR & 2HR chart)

   1. 4054 - February’s VAL

   2. 4055 - negative vanna

4. 4080 - negative vanna

Stay #paytient and react to the key levels - no predictions! Good luck traders.

Reminder, this is an unusual trading month where we have an additional week of weakness in Vanna and Charm. So pay extra close attention to the Gamma levels and any key volume profile value area’s and points of control, along with bullish/bearish orderblocks, and dark pools. They will compliment our dealer data for this week.

Typically after OPEX, Vanna and Charm go on a 1 week vacation until the new month. Since this trading month has 5 full weeks - 2 more weeks until EOM - we will actually experience two weeks of relative weakness in Vanna and Charm…

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I am going to share my key rules to intraday trading in the end of the plan moving forward to build better habits and allowing you to grow as a better trader.

My Intraday Trading Rules

1. I do not trade within the first half hour UNLESS I am in a trade from the prior session and looking to close the trade or we have a major gap or a key level already broken

   1. I let the initial balance do its thing - I am just a small fish in a large ocean of traders so let's let them fight it out

   2. I then wait for key levels targeting one level to the next and taking profits at each one.

      1. If there are key levels that are 10pts apart that is when I have scalping mindset and anything above 10pts I want to give it the room to hit the price target with a 5 pt buffer to take profits once we reach within 5 pts of a target - I also tighten my stop loss once at 10-20% profit with the goal of never allowing trades to go red when I have a nice profit)

2. I supply options greeks with OB (order blocks) and FVG (fair value gaps) otherwise known as Smart Money Concepts

3. When I am scalping - ie targeting 10pt trade levels I will take profits and never go more than 10% red. Simple as that, know your trade plan strategy and the risk. When you are wrong you are wrong and reset

4. For 20pt trade level targets I will increase my stop losses to 20% and allow more of the trade to play in the event I entered too early

5. I try - key word try ha - avoid trading lunch hours defined as 12pm to 2 pm est. Money for the most part unless you are scalping - is made in the first 2 hours of the trading day and the last 2 hours

6. I always stick to two EMA’s on my chart and that’s the 10/50 EMA’s

   1. When the 10ema is above 50ema we are bullish

   2. When the 10ema is below the 50ema we are bearish

   3. Go put these on your charts and when you view them on timeframes less than the daily timeframe you will see the power they provide

   4. For scalpers out there the smaller timeframes provide great opportunities to scalp 5-10pt moves

There are more we could discuss including volume profile, low volume nodes that I think are great strategies to compliment option greeks. Maybe in the future we can include more details.

Trading is not for the unprepared. It is critical you abide to a strategy and checklist and walk into every trade with a plan. Without a plan you are simply gambling and have a better chance at the slot machines. There are more nuances to my weekly and daily checklists, but I think this provides a good read for now and we will/can continue adding to it.

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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.

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