Gamma Levels

Common Questions when Using Gamma Levels

In this lesson, you’ll learn answers to common questions about using gamma levels, including when data updates, which assets to monitor, and how to convert levels for futures trading. Understanding these practical details helps you access the right data at the right time to make better trading decisions.

We provide different update schedules depending on the asset type. Stocks, ETFs, and indices update with end of day data at around 5:30 to 6:00pm Eastern Time after market close. We also offer intraday data that updates 14 times per day, with the first snapshot at 8am for pre-market and then every 30 minutes starting at 9:50am. Futures data updates once a day with end of day information, while crypto data updates at 8pm Eastern.

You might wonder why we provide levels on SPX, SPY, and ES when they track similar markets. The key insight is that these three assets have completely different option chains and different market participants. SPX is cash-settled and primarily traded by large institutions in big blocks, SPY attracts more retail traders and long-term asset managers using 401k accounts, and ES is used by futures market makers and CTAs. By comparing levels across all three, you can spot hidden areas, confirm high conviction strikes, and detect unusual divergence.

If you trade futures and want to use intraday data, you have conversion options available. For ES traders, monitor SPX or SPY. For NQ, watch QQQ and NDX (with QQQ having far more option volume). You can even convert individual stock levels like Apple, Amazon, or Nvidia onto NQ during earnings. For Russell futures, use IWM. For YM (Dow), which has no option activity, use DIA. For Bitcoin futures, you can use our Bitcoin gamma levels or convert IBIT levels. Gold traders can use GLD, crude oil traders can use USO, and bond traders can use TLT.

To start applying these concepts, identify which futures contracts you trade and determine the corresponding ETF or index with active options. Monitor multiple related assets to gain comprehensive market insights and confirm your trading decisions with data from different market participant groups.

Video Chapters

  1. 00:15 – When gamma levels update for different assets
  2. 01:38 – Why to monitor ETF and index levels when trading futures
  3. 02:31 – Understanding different option chains for SPX, SPY, and ES
  4. 03:57 – Comparing levels across assets to spot divergence
  5. 05:05 – Converting intraday data for futures trading
  6. 06:03 – Asset conversion options for different futures contracts

Key Takeaways

  1. Intraday data updates 14 times per day starting at 8am, while end of day data updates at 5:30 to 6:00pm Eastern
  2. SPX, SPY, and ES have three different option chains serving different market participants, making it valuable to monitor all three even if you only trade one
  3. You can convert ETF and index levels to futures by monitoring corresponding assets like SPX/SPY for ES, QQQ/NDX for NQ, or IBIT for Bitcoin
  4. Comparing levels across related assets helps you spot hidden areas, confirm high conviction strikes, and detect unusual divergence
Video Transcription

[00:00:15.20] - Speaker 1
Next we are gonna go into some frequently asked questions and then we're gonna go into some example. So the first question that we get is when do the levels update? So we have different types of levels. So we have levels on stocks, ETFs, indices, those are both end of day. The end of the data updates at around 5:30 to 6:00pm Eastern Time after the market close.

[00:00:46.05] - Speaker 1
But we also have intraday data available for you guys that updates 14 times per day. The first snapshot comes at 8am which is the pre market snapshot with the updated open interest. And then we start updating the data from 9:50 onwards every 30 minutes. Futures data update once a day. We currently have end of day data on futures but we are also going to show you in the next few slides how you can actually convert intraday data on futures.

[00:01:17.00] - Speaker 1
We also have our crypto data that updates at 8pm Eastern. And then we have our blind spot, level and swing levels that update at 11 and 6pm Eastern. We're going to talk about blind spots and swing levels in a separate meeting, in a separate call today. We're going to focus on mostly gamma levels. All right, second question that we get.

[00:01:38.21] - Speaker 1
You provide levels on ETFs and indices. But if I trade futures, why should I convert levels and how it works? This is a very great question. So the first thing that is important again going back to what we said at the beginning, you need to have an edge and you need to be able to access data fast to make better decision. So here we show you the three different charts.

[00:02:02.20] - Speaker 1
This is the net GAM exposure chart of spx, SPY and es. As you can see they are slightly different. Although they might tell you a similar picture, they're actually not exactly the same. So by looking at these three separately, this can actually give you some really good insights on on where the market is moving. Even if you are trading future, you should be paying attention to what's happening with the other assets that are actually moving in the same direction.

[00:02:31.28] - Speaker 1
The other question that we get, why is the put support and core resistance different from SPX to yes, Right? And the answer is again simple. Spx, SPY and ES have three different option chain. So again three different chains. And it's very important that you understand also the customer that is trading those assets.

[00:02:53.27] - Speaker 1
So if we look at SPX we have a lot of institutional flows coming in. SPX options are cash settled. They are normally traded in big blocks, so they are normally traded by large institutions. SPY is more of a retail product or long, long term asset managers. Where they use SPY as a tool tool to invest in the market.

[00:03:18.10] - Speaker 1
So if you are a retailer you would have Spy in your 401k or QQQ in your 401k. If you are a like an asset manager with a long term view, you will also hold SPY and you might be hedging your SPY positions not because you think the market is gonna drop, but because the market you don't want to lose your profit. So when we see like this divergence between SPY and spx that's also very, very important data. And again, yes, futures market maker ctas are using YES to trade. So again very, very important that you understand who is the customer for this type of data.

[00:03:57.01] - Speaker 1
And again, by comparing levels across all of these three assets you can actually spot hidden areas, you can confirm high conviction strikes and again you can detect unusual diversion. So again we give you access to all three of these option chain. So it's up to you to use them at your advantage but also you add the flexibility to potentially, to potentially use them in conjunction. We have a good questions from MA which actually is very pertinent to what we are doing right now. Do JAX levels for SPX spy?

[00:04:36.16] - Speaker 1
Yes, a different weight. So I think SPX is by far the asset with the largest option flow. So if you are trading yes, you definitely want to look at SPX because by volume is the, is the highest. Then you have spy which is also very, very high in volume and then you have yes, so I would say very, very important that you monitor those because they have different volume and different implications.

[00:05:05.29] - Speaker 1
All right, so if I trade futures and I want to use intraday data, what can I do? So you can use the end of day futures levels coming from the futures option chain, but you can also do conversion and we're going to go into conversion in a second. So if you're trading yes, you might want to monitor SPX or spy. If you trade nq, you might want to monitor QQQ and ndx. The reason why I put QQQ in front is because QQQ as by far more option volume than ndx but also NDX levels are actually very, very important.

[00:05:41.09] - Speaker 1
You could also convert Max 7. So let's say that tomorrow we have earnings, Apple, Amazon. You want to see the Apple levels on NQ because you think that that's going to have a big impact. You can also do that or Nvidia. When Nvidia reports you could actually convert Nvidia Gamma levels onto nq.

[00:06:03.11] - Speaker 1
If you trade Russell, then IWM would be your option if you trade dao. DAO is a very interesting one. DAO does not have any option activity, so there's no options on YM or on the futures. So what you can use is you can use the dia, which is the ETF of the of the Dow Jones, or you could use our blind spots indicator on YM if you trade Bitcoin. Now, we do have gamma levels on Bitcoin by looking at the Bitcoin option chain, but you could also actually convert the iShares.

[00:06:40.07] - Speaker 1
Ibit. Ibit has a lot of option volume. So it could be very, very interesting, could be very, very important. If you trade gold, then you have gld. And if you trade crude oil, then you have uso.

[00:06:51.21] - Speaker 1
If you trade bonds, then you can use TLT or any of the other ETFs that are looking at bonds, exposure and so on.