May 30, 2023 SPX, SPY, ES Trade Plan

Good evening/day/morning traders. We finally got some volatility and range in the market last week. Another great week with our trade ideas heading key level to level. To review those trades again find me on Twitter - @DarkMatterTrade.

If this is your first time reading our trade plan I highly suggest you read my Intraday Trading Rules…

This week we are expecting to have even more volatility and range. The weekly option expected move on SPX is at ~78 pts this week. With that let’s not forget why…debt ceiling continues to be an important catalyst while we have important data catalysts coming this week.

Those catalysts include the Consumer Confidence rating out tomorrow, followed by JOLTS Job Openings Wednesday, Unemployment Claims/ADP Non-Farm Employment Change/Manufacturing PMI Thursday, and Friday brings us Non-farm Employment Change, Average Hourly Earnings, and the Unemployment Rate.

Last, but not least we have our fair share of FED speakers this week.

With that, let’s jump into the trade plan.

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

The debt ceiling will be a critical news catalyst. So if you are in a trade keep a tight leash on it as any news could rally or sell off the market rather quickly.

1. 10:00am est - Consumer Confidence

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 value is approx. 8pts more than the SPX levels shared below. To get SPY levels simply take the SPX levels below and divide by 10.01.

Bullish bias:

1. Above 4230 target 4245

2. If there is a breakout of 4245 target 4260

   1. Use VOLD indicator for trend continuation

   2. VIX should be decreasing

3. If there is a failed breakdown of 4190 or 4200 target 4225

   1. Use VOLD indicator for trend reversal

   2. VIX should be decreasing

Bearish bias:

1. Below 4195 target 4155

2. If there is a failed breakout of 4225 target 4210

   1. Use VOLD indicator for trend reversal

   2. VIX should be increasing

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SPX - The Why Behind the Plan

Key Levels

Above Spot:

1. 4210-25 - negative vanna

   1. 4230 - positive gamma

2. 4245 - negative vanna

   1. 4250 - positive gamma

   2. 4231-4243 - OB (1hr chart)

3. 4260-65 - negative vanna

   1. 4275 - positive gamma

   2. 4243-4279 - FVG (2hr chart)

      1. 4262 midline

4. 4280 - negative vanna

   1. 4275-4291 - OB (2hr chart)

      1. 4282 midline

Below Spot:

1. 4200 - negative vanna

   1. 4200 - positive gamma

   2. 4203-4197 - OB (30min chart)

      1. 4200 midline

   3. 4205 - 420.03 - $2.51B

2. 4190 - negative vanna

   1. 4190 - positive gamma

   2. 4196-90 - 419.20-418.60 - $11.82B

   3. 4188-4161 - FVG (1hr chart)

3. 4161-4151 - OB (2hr chart)

   1. 4155 midline

   2. 4160-56 - 415.66-415.28 - $9.8B

4. 4145 - negative vanna

   1. 4145 - positive gamma

   2. 4150-25 - 414.64-412.18 - $23.31B

   3. 4130 - negative vanna

   4. 4130 - positive gamma

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Dark Pool Levels

Interesting buildup of dark pool prints last week. The 410.34-411.59 zone added over $6B - making this a key critical support level. We also saw an increase in the 4190-96 level by $2B in dark pool. We also had our first large dark pool print near the highs of Friday’s session at 4205.

1. 4205 - 420.03 - $2.51B

2. 4196-90 - 419.20-418.60 - $11.82B

3. 4160-56 - 415.66-415.28 - $9.8B

4. 4150-25 - 414.64-412.18 - $23.31B

5. 4120-07 - 411.59-410.34 - $17.13B

6. 4100-4096 - 409.62-409.22 - $8.56B

Dark Pool Levels via Quant Data for 5/26

We need to pay attention to these dark pool levels. Mark them on your chart as key levels that we should pay attention to. Remember the levels where we see dark pool prints greater than $2-4B should peak our interest. I get my dark pool levels from Quant Data.

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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. OB’s are the stronger levels over FVG’s.

1. 4231-4243 - OB (1hr chart)

2. 4243-4279 - FVG (2hr chart)

   1. 4262 midline

3. 4275-4291 - OB (2hr chart)

   1. 4282 midline

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. OB’s are the stronger levels over FVG’s.

1. 4203-4197 - OB (30min chart)

   1. 4200 midline

2. 4188-4161 - FVG (1hr chart)

3. 4161-4151 - OB (2hr chart)

   1. 4155 midline

4. 4098-4072 - FVG (2hr chart)

5. 4049-4035 - OB (2hr chart)

   1. 4042 midline

Green Fill: Bullish FVG’ or Demand - Green Outlines: OB’s or Demand; Blue Fill: Bearish FVG or Supply - Blue Outline: OB’s or Supply

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Weekly Option Expected Move

SPX’s weekly option expected move is ~78.86 points. SPY’s expected move is ~8.08. Remember over 68% of the time price will resolve it self in this range by weeks end.

SPX Weekly Expected Move for Week of 5/29

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Volland Data

The Volland team now provides new product tiers providing you with more intraday updates. This is an amazing asset to have intraday to see how dealers are positioning themselves adding more conviction to our levels and changes to the key levels for the 2nd half of the trading session. Take a look by visiting the Volland site for their various options - including Volland 30 - the package I have subscribed giving me updates every 30 mins.

Volland's new subscription packages

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.

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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.

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. 4210-25 - negative vanna

2. 4245 - negative vanna

3. 4260-65 - negative vanna

4. 4280 - negative vanna

Below Spot:

1. 4200 - negative vanna

2. 4190 - negative vanna

3. 4145 - negative vanna

4. 4130 - negative vanna

Aggregate view of Vanna via Volland

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Gamma and Delta-Adjusted Gamma (DAG)

Positive Gamma Above Spot - acts as resistance

Positive Gamma Below Spot - acts as support

Negative Gamma - becomes permissive to price as it moves there - aka neither resistance nor support - simply just chillin and watching what’s happening…

Above Spot:

1. 4230-35 - positive gamma

2. 4250 - positive gamma

3. 4275 - positive gamma

4. Dealers are buy above 4220 to 4295

   1. If price breaches this level the move could go even faster as dealers will need to buy and hedge their positions

Below Spot:

1. 4200 - positive gamma

2. 4190 - positive gamma

3. 4145 - positive gamma

4. 4130 - positive gamma

5. Dealers must sell below 4150

Aggregate view of Gamma levels

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

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Charm

Charm total notional value is bullish - negative is bullish and positive bearish - take the total of the far left and far right values.

Negative total notional value shows bullish charm

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

SPY Charm - Aggregate View

Note that the total notional value of SPX is 10x. Thus it’s charm will outweigh that of SPY’s. For the full charm effect to play out ideally we want to see SPX and SPY in sync.

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My Intraday Trading Rules

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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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