Good Morning!
There wasn’t a ton of significant flow on Friday, so I want to take this opportunity to share with you a different projection as we gear up for market open today.
How To Trade SPY This Week (3/20 Exp)
Looking at the gamma heatmap for SPY heading into this week, one level stands out as the most important pivot in the entire market structure.
SPY is currently trading around 662, and the largest gamma cluster for the week sits directly below at 660, showing roughly -$1B in negative gamma exposure.
This creates a very clear roadmap.
When markets sit near large gamma levels, dealers must hedge aggressively, and that hedging behavior often dictates the short-term direction of price.
Here’s the simplified playbook.
Bullish Setup
If SPY holds above 660, the market is likely to remain relatively stable.
There is very little gamma resistance between 662 and 670, which means a push higher could move quickly toward the 670-673 area.
Trade idea:
Look for dips near 660-662 to buy calls targeting:
👉 667 → 670
Dealers hedging in this zone tend to buy dips and sell rips, which keeps the market contained in a range.
Bearish Setup
If SPY loses 660, the structure flips.
Below this level sits heavy negative gamma, which means dealers are forced to sell as the market drops.
This can accelerate downside momentum quickly.
Trade idea:
Break of 660
Target:
👉 655
If selling accelerates further:
👉 650 becomes the next magnet
⚡ Volatility Trigger
The 660 level is the volatility switch for the week.
Above it:
Expect choppy range trading.
Below it:
Expect faster directional moves and potential sell-off acceleration.
Simple Weekly Game Plan
Above 660
Trade the range:
• Buy dips
• Sell near resistance
Expected range: 660 → 670
Below 660
Momentum likely takes over:
• Look for downside continuation
Targets: 655 → 650
The Closing Bell
The gamma structure this week is heavily skewed to the downside, meaning volatility is more likely to expand on sell-offs than rallies.
As long as SPY stays above 660, the market should remain relatively controlled.
But if that level breaks, things could move fast.
I’ll be watching the market all day today to see if there is any notable flow to share with you all. I’ll report back tomorrow!
-Caleb