RTM captures institutional order flow.
Flow large enough to actually move indexes.
It's not dealer hedging flow, but there are similarities
(and it pairs really, really well with VS3D hedging data)
Here's what RTM is >>
RTM is a premium retail day-trading community and a proprietary algorithmic model known.
The signals from the model are streamed over a private Zoom call with live intraday commentary from both TC & Scotty.
Alongside the RTM model we stream the VS3D intraday SPX hedging profile, and I (VolSignals) provide access to my intraday commentary from VS Pro, and whenever possible- join the live conversation on stream too.
Convergence between models is excellent- but this thread is about RTM's specific signals
We stream real-time, institutional-grade market microstructure data for trading the S&P 500 (SPX options and /ES futures).
It's perfect for futures traders.
It's perfect for 0DTE traders.
Key signals from the model
The "Lines" (SML/SAL):
The model calculates a "Strongest Morning Line" and "Strongest Afternoon Line," which act as institutional equilibrium areas where price is expected to either magnetically revert to or aggressively trend away from.
These lines often produce market outcomes that look just like what happens when we PIN key SPX inventory.
When lines show up aligned with dealer PIN inventory
...excellent
Box Prints (e.g., 2-Box, 7-Box):
Boxes reflect specific activity in the index-related assets we track, occurring at a certain level and time.
When these boxes appear sequentially they indicate trend or exhaustion.
Certain types of boxes have proven "different" than others, over time... e.g., a "7 Box" near the SML indicates a high probability of mean reversion
AP Callouts & White Arrows:
Real-time tracking of "Authorized Participant" (institutional) buying and selling pressure, and directional 'counter-trend' arrows often flag sharp, imminent moves during the session.
Market Regimes:
The model explicitly categorizes the market into environments like "Secular Mean Reversion" (SMR) and "Secular Trending Mode" (STM) to dictate trading strategies.
Our Pricing Bot streams intraday options context from the 0DTE profile, adding insight about the market's expected moves as well as pricing convex strategies that exploit the signals from the model.
The RTM model is one of the sharpest models I've seen, especially when paired alongside our dealer hedging flow data
They can fix the strike- but that would make it vary in cost. When implied volatility is low, they would likely pay a meaningful net-premium for the structure.
So they fix the cost ($0) and vary the strike
So they are always hedged
with a structure like this:
Fund owns -20% / -5% Put Spread (for protection)
Fund is short the up ~4-5% Call (to fund protection)
The market trends UP over time.
It should not be surprising that we wind up near or at the Call strike, most quarters.
SPX has been grinding down to the JPM Collar hedge level at 6475 as vol has steadily crept higher.
Does market maker hedging cause pinning behavior at major dealer short-strikes?
NO.
(A THREAD)
Price doesn't gravitate towards a near-dated short option the same way it does a long option.
Especially since charm (delta decay) literally forces the dealer to hedge in a way that pushes the market away from their shortest position as that position decays.
So what's actually happened this cycle?
Have you noticed anything interesting about Volatility?