Good Morning!

Hope you had a productive Tuesday and are ready to conquer the market today. Let’s dive into our most intriguing whale flow of the day from yesterday.

Let’s take a look at our daily whale flow and see where smart money was allocating money yesterday.

DELL is not our typcial name we see receiving large amounts of bullish flow. This one caught my eye as just under $8 Million of capital came into DELL calls yesterday. This is one to keep an eye on.

This one wasn’t especially interesting due to volume alone (although 2.5M is fairly significant for a 1 week contract) but more so the proximity of this flow coming in on GOOG on a red day like today. This money came in with a Friday expiration. Generally, a relief bounce could be on the way and make these contracts age really well. As I type this, futures are nice and green as well which could further promote a good day ahead for this whale and these contracts.

We’ve got some interesting developments on SPY. The massive negative gamma at 640 with a 3/27 exp has been pulled. That takes away that huge bearish magnet that was on the board for a few days.

Instead what we have no is we are actually in a pocket of positive gamma where we sit at $658. From $657 to $665 we have heavy pockets of positive gamma (as it stands now, anyways). This means that it will be more difficult for the stock to really push out of that range today. It’s not impossible, but I would be shocked to see SPY over 665 today.

Negative gamma (negative gamma accelerates moves) still exists at $656 and below. Based on the current positioning, puts could come into play below 656 especially if we slide into that large pocket at $655.

Based on current positioning, I wouldn’t be buying calls in the current range we are in now. I’m either buying puts into this negative gamma if that move happens or I am waiting for all of this gamma exposure to rearrange and present better opportunities.

Remember, you do not have to force a trade everyday. Trading is a game of positioning, probability, and patience. I want to wait for the positioning and probability to give me the best chance of making a quick and profitable trade. If this GEX Map updates and completely looks different I’ll be sure to let you know!

-Caleb