The Week Ahead 7/20
SPY pivots, GOOGL/TSLA earnings preview Stocks to watch & more!
Good Morning Substack,
SPY 0.00%↑
On a day when the SPY gapped lower to begin the session, traders tested the 740 level and attempted to close the gap above it, but ultimately failed on Friday as the SPY rejected tests above 747.
The session was marked by bearish SPY option activity, with put flow outpacing call flow nearly 2-to-1.
One unusual and new area participants targeted on Friday was the end of this month’s SPY 718p.
This wasn’t the only unusual positioning for the session. With only seconds left in the session, a participant could be seen positioning in the SPY 7/30 753c, a new opening order that should already be in the green this morning, with the SPY gapping higher.
SPY 0.00%↑ Greeks
When attempting to decipher the SPY’s price action during the beginning of this week’s trade, participants can utilize the data derived from the SPY’s net gamma exposure to help analyze the price action in areas with key positioning.
It is worth noting that there is significant positioning at the 7/23 SPY expiration, including targets above and below the range shown below. Should volatility once again present itself during the coming week, positioning at this expiration would stand to gain.
SPY pivot = 745
Look for weakness to target this area
Should it act as a floor and the SPY will have a chance to reverse towards the gap above
Targets 747, 750
Above 750 all short gamma positioning will be forced offside
Targets 752, 755
Failure to trade >750 can result in trade back towards 747, 745
Loss of 745 promotes further weakness
Targets 743, 740
Earnings Extravaganza
Tuesday
Wednesday
Traders looking to analyze TSLA’s earnings reaction can utlize the pivots derived via its net gamma exposure
