🔴 | THE MARKET IS DOING THE UNTHINKABLE | No One is Seeing This | GEX Analysis

A unique situation is unfolding in the stock market, one that will greatly surprise you in the very near future. And in today's episode, we will discuss the further prospects, where the price is headed, and what profitable trading ideas can be implemented as a result. But before we discuss where the market is headed next, let me tell you about the unique situation we witnessed last week. Last week was a shortened one. Trading only started on Tuesday, and that day can be called the Day of Judicial decisions. Tuesday opened with a gap down, and this was due to the news that emerged the day before that an appeals court was blocking Trump's tariff policy. By a vote of 7 4, the court ruled that the law cited by Donald Trump when imposing these unprecedented tariffs does not actually give him that right. At the same time, the court stayed the ruling until October 14th to give the Trump administration time to appeal to the Supreme Court to overturn this decision. And looking at what happened to the market on Tuesday, we can say that traders perceived this information in two ways. On the one hand, seeing the market open with a sharp drop indicates that investors had some concerns that if the tariff policy is blocked, and if on top of that, it is declared that all previous tariffs were illegal, it might even be necessary to return the money to the economic counterparts that had already been collected during the existence of these tariffs. Naturally, giving back what's yours is much more upsetting than taking what belongs to others, and this dampened investor sentiment. But on the other hand, a positive was found in the fact that if the tariff issue is finally closed for good, the main question regarding future inflation will be off the agenda. Naturally, under such circumstances, it would not rise. But besides this, towards the end of the trading session, news emerged that a US Judge had made a ruling on the Google monopoly case. The company was ordered to share information with competitors, but it won't have to sell the Chrome browser and Google is not required to abandon the Android operating system. Naturally, this news impacted the rise in Google's stock price. Plus, Apple joined in, and since the two largest companies surged upward, it led to the index's growth. As a result, by Wednesday, market participants had a sense that the situation had been stabilized. The news was interpreted as positive, and one could look to the future with optimism. And this is where we get to the most interesting part. In this video, I explained in great detail what really influences the market's movement. I strongly recommend watching it because it contained information that will be a real revelation for 90% of you. The key takeaway from that video is that all market movement is built around Liquidity and the actions of the market maker. And our task is to join the market maker's actions, not go against them. But how do we catch it? We can track the market maker's actions using the gamma exposure profile. It is this metric that shows where the key support and resistance levels are, as well as how the market maker will move the price. The gamma exposure profile is available in our application. The link to it is in the description below. This video and the gamma exposure profile for SPX on Wednesday, September 3rd looked like this. This is an incredible pattern. I discussed how to trade in such a situation in more detail in this video. But the general idea is that when we see almost identical negative and positive gamma values, which are further reinforced by peak absolute gamma levels, it's an excellent situation for building neutral strategies like an iron Condor which can be opened right at the start of the trading session. When we see such a gamma exposure profile, it means the market maker will keep the price within this range for as long as possible and at least for the first half of the day. The price will definitely not move outside this range. Also, as the price approaches support or resistance levels, you can open counter trend trades, for example a bear call spread. Moreover, these positions don't necessarily need to be held until expiration. For instance, on Wednesday, if we're talking about an iron condor, the position profile looked like this. We set the wing width based on the largest negative and positive gamma values, and at that time the price was near the resistance level. We can see that even with a slight downward price movement, this position would already start generating good profit and could be closed below. On the main page there is another chart that shows the most key dynamic support and resistance levels. And that day we see the resistance level was at the 6450 mark, which also coincides with the largest positive gamma values. But besides that, our application has many other useful resources. For example, there is this chart on the main page. We already discussed above that on that day, Wednesday, September 3rd, the resistance level was at the 6450 mark. But on this chart we can see that the maximum values of the power zone and the quant power line were also situated at the 6450 level. I can't explain in detail what these indicators are every time because it would take too long. So I recommend watching the previous videos where this was covered extensively. But in short, the quant power line and the maximum power zone values act as a kind of compass indicating where the price is likely to head. Therefore, by looking at just these three charts, we could form a very clear picture of what would happen to the price throughout the day. We saw the levels between which the price would move. We understood the reason why the price shouldn't leave this range. But also, thanks to the quant power line and the maximum power zone values which coincided with the resistance level, we were prepared for the day to close near the 6450 level. During the day, the price moved down from the resistance level, providing opportunities to close positions with a profit. But the quant power line did not change its position until the very end of the trading session. And ultimately the day closed exactly at that level. But then truly astonishing things began to happen. This is the gamma exposure profile from the next day, Thursday, September 4th. And here we see an absolutely identical situation to the previous day. The difference is that the key levels shifted slightly, the range became a bit narrower, but the overall situation was identical. There was a strong support level at the 6410 mark, a resistance level at 6480, and the peak absolute gamma values were also located there. If we look at how the power zone values were distributed, there was an interesting situation. I've already explained that the power zone indicator shows us two of the most important things. First, it's the range within which the price will move. And second, it's the level that the price will gravitate towards. When we talk about the range, we need to visually identify the square containing the largest concentration of values. This range indicates the area where the price will aim to trade and where it will spend most of its time. In other words, if we see the price leave this range and for example, approach a lower important support level, we can bet on a rise from that support level, expecting the price to strive to return inside the range with the largest power zone values. On September 4, we see the largest values were in the 6450 to 6500 range. Moreover, the 6500 level was somewhat detached from the main block because there was a dip there. Thus, we could mark this level as a secondary resistance zone. But a price rise in that direction was not a priority because the price would first need to overcome a very strong resistance level at 6480. The importance of this level was also confirmed on this chart. But that day there were two interesting factors. Firstly, it was the second day in a row that the gamma exposure profile looked like this. As I mentioned earlier, this clearly indicates that the market maker is creating an artificial range within which the price will move. Just remember this point for now and everything will Become clear to you in a couple of minutes. The second interesting factor was that on that particular day, the power zone indicator did not have a pronounced peak with large values that would act as a magnet for the price. Don't get me wrong, there was a maximum value and it was at the 6480 level. But the overall appearance of the power zone indicated that the priority that day was not to push the price as high as possible, but to prevent it from falling below the 6450 level. If we look at how all these levels, including the gamma exposure and absolute gamma values would appear on a regular chart, it would look like this. Among the key points, we can identify the resistance zone around 6480 and slightly above 6500. These are the last large power zone values we saw on this diagram. As I said above, a rise to the 6,500 level was not a priority that day. As based on the overall structure of the Gamma exposure profile, the 6480 level was not supposed to be broken upwards. However, that day the price still managed to rise to the 6,500 level. And despite the fact that this possibility was visible even at the beginning of the trading session, it was not the priority scenario. In the last 11 times that the gamma exposure profile formed such a pattern, this was the first time the price overcame the boundaries of the range. And this is where we get to the most interesting part. Because if we look at the gamma exposure profile on Friday, September 5th, it looked like this. And this was the third day in a row that this pattern had formed. Let me repeat. When we see such a picture, it means the market maker is artificially creating a range within which the price will move. Therefore, in the vast majority of cases, the price will not break through the key support and resistance levels. This situation can be explained as follows. A large player, such as a fund, approaches the market maker and asks them to keep the price within a specific range in order to sell off their positions. The thing is, a large player cannot simply press the sell button like you and I, and sell at the market price. This is because we are talking about tens of billions of dollars. If they were to do that, they would instantly drain all the liquidity from the market. Quotes would start to fall, and in that case they wouldn't make any profit. One sale would be at this level, the second sale at a lower level, the third even lower, and so on. To avoid this, they enlist the help of the market maker. In other words, the market maker creates the necessary liquidity and keeps the Market within the range. Thus, the large player sells part of their positions here, another part a bit cheaper, a third part even cheaper, then perhaps a bit higher. Again, if we were to draw a schematic, the average selling price would be approximately along this level. And the higher they can sell, the better. Of course. Therefore, the market maker creates a range to ensure the price doesn't present any surprises. So when such a situation occurs within a single trading day, it's not particularly noteworthy. When this pattern appears for two days in a row, it's time to pay attention. Because we understand the entire market is essentially being held for a very large player. But when this situation happens for a third consecutive day, it becomes serious. Literally. One can assume that the entire market is being held either for a mega large player or for several large players who are simultaneously deciding to close their positions. On Friday, the key resistance level was at the 6535 mark. The 6450 level was support, and the gamma flip zone was also located here, further strengthening this level. The gamma flip is the point where gamma exposure transitions from positive to negative values, and this level always holds particular significance. You can learn more about this in the dedicated playlist on this topic. When we transfer all these levels to the trading chart, they look like this. 6535 is the resistance zone. This is where the largest positive gamma values and the largest absolute gamma values are located. While the 6450 level is support. Despite the price breaking out of the range the previous day, that was an exception to the rule. Therefore, when we see this pattern, we should still either build neutral strategies or trade from the support and resistance levels. On Friday, the day started near the resistance level, which was an excellent place to open short positions. But note that when the price reached the support level, it was precisely this level that halted further decline and initiated an upward bounce from there. The entire philosophy of our website is built on the principle that analyzing the market situation should take no more than a few minutes. Being as visual and understandable as possible, we immediately see all the important levels and understand how and in which direction the price should move. And even in the rare case that the price deviates from the projected trajectory of the main movement, the we will still see the levels it could reach, as was the case for example, on Thursday, September 4th. Let's summarize. The information we received from the gamma exposure profile last week can be interpreted from two perspectives. If viewed in isolation from the overall market situation each day we saw very clear support and resistance levels that we could trade. However, the uniqueness of the overall situation was that for several consecutive days we saw identical patterns, which is atypical, and their structure highly suggests that the market was being held to allow smart money to reduce or rebalance their portfolios. This does not necessarily mean the market must fall the next day. It simply implies that unloading is occurring at current levels. In the coming days, it is crucial to closely monitor the 6450 level because if a breakdown occurs, it could mark the beginning of a market reversal. Here's the thing. Last Wednesday, schematically the price traded and closed within a specific range. On Thursday the range was at these levels and only at the very end of the day did the price break slightly beyond its boundaries. On Friday we had this range, with the price closing at the midpoint of Thursday's level. Superficially, it might seem the market was rising until Friday, but if the 6450 level is broken, it will signal a full fledged market reversal where large players have unloaded their positions at an average price. Speaking about the overall market situation, I maintain the opinion I shared with you in the previous two videos. From a medium term perspective, the probability that we will see a downward movement develop from this range is significantly higher than the probability of seeing the market rise by an amount equivalent to this potential decline. The nearest level that should be tested in any case is the 5,800 to 6,000 point range. What happens after that is still a question. Perhaps after testing this level, for example, during the Santa rally period, the market will find the strength to retest the historical highs once more, and only after that will a more substantial decline follow. Option number two is that after a retest around the 6,000 point level, a small upward bounce will occur and the market will then begin to descend. A turning point could begin in the middle of this autumn. Long term traders can even start opening short positions at current levels and the potential profit over the year could be huge. The NASDAQ index is particularly well suited for short positions right now. From a technical analysis standpoint, all attention is now focused on the 20 period moving average. Algorithms are fighting for this line and every time the price touches it or even goes slightly below, the algorithms start buying back trying to stabilize the situation. However, after a consolidation below the 20 period moving average, and especially below the 50 period moving average, where stop losses are often set by the way, the downward movement could accelerate. If we look at the volume distribution throughout this entire upward move, it's clear that the highest volumes are right at the MA20. Significant volumes are also at the 50 period moving average, while there is a volume gap from the 6250 level down to 6000 points. Since there are no barriers for the price here, this further indicates that a break below the 50 period moving average could accelerate the downward movement all the way to 6,000. Despite the SPX showing an upward trend over the last month and a half, there is no visible strength in the market. The average range is around the 6450 level, and we quite often see impulsive corrections alongside rather weak new highs. For example, at this level the highs were updated by literally a few points within a single day, and last Friday the highs were actually updated in the pre market session. Good luck with your trading and see you in the next video.