Market overview, key $SPX level to watch and info this week, CTA position info, general trends market, economic calendar, and various other info.
A short thread 🧵
Please ❤️ and 🔄 if you like this education information.
$SPX: As mentioned many times in previous tweets, 3950 has been held as a support from gamma, vanna, & as well as being 200 SMA. It all adds up from TA & PA perspective.
🔑 level to watch: $VIX- >22, bearish. 22-21 is chop. <20.60 for squeeze to 4040/4080.
RES @ 4065.
This is gamma (GEX) total profile for the next 2 expirations- mark 🔑 levels.
How to read this: MOST $$$ at $400 spy. (C/P). This means most hedging by MM.
Surprise? No. Major psych level & major 🧲 months!
Predominately bearish 395-390.
Less hedging aka dealers involvement these strikes, can suppress volatility unless $VIX pushes >21.80. And >22.30- big extreme moves.
In neg gamma , which means larger intraday moves with elevated $VIX.
IV drops- vanna kicks in, 🧲 to $400 spy , $spx 4010~.
$QQQ:
The tech indicator. Has shown quite a retrace since it’s run(due to CTA also being -12% short in January to net Long). CTA also net short here we stay below Friday’s high levels.
Apollo algo @_d3f4ult giving sell signal on 1H. Still holding and 🔑 watch $292.50/293
$DXY: Dollar on a vengeance?
Remember: $DXY is opposite of stock market. $DXY bullish is BAD for high beta (TECH QQQ), emerging markets and general all markets.
$YEN been approaching highs USD/YEN.
$EURO near lows. $DXY can be bullish here.
Good keep your 👀 on $DXY daily
$TNX: 10Y rate. I mention this a LOT.
What’s it mean? Rates rates rates.
This follows 10Y bonds, bullish 10Y= bearish $TLT.
Higher rates= more pain stocks due tighter lending standards.
VIX futures term structure chart represents the market's expectations for future volatility over the next several months.
Spot VIX is at 22 as of this moment ~
🧵/3:
Overall, the term structure suggests that while markets anticipate some stabilization, they still expect a relatively high level of volatility compared to historical norms.
🧵 Ever wonder why markets sometimes go completely crazy after options expiration? Buckle up - I'm about to explain why timing + volatility can create the perfect storm...
1/ First, let's talk about what happens during normal options expiration (OPEX).
Market makers are constantly hedging their positions to stay neutral.
It's like a carefully balanced dance.
.
2/ Two key players in this dance: Vanna (how delta responds to volatility changes) and Charm (how delta changes as time passes). These create stabilizing flows that help keep markets in check.