Gamma gone wild (watch what just happened)

Look, I don't care what you heard over the weekend about valuations or ceasefire headlines or any of that noise. 

What just happened in the market wasn't about fundamentals. It was pure gamma. The largest gamma squeeze I've ever seen in my career, and I've been trading the SPX since 1998.

Three weeks in a row, we breached the expected move to the upside. Three. That's statistically insane, and the only other time I have three consecutive breaches on record is the COVID crash going the other direction. 

This is a crash to the upside, and if you don't understand what's actually driving this move, you're flying blind at 180 miles an hour.

The S&P moved 300 points this week. Microsoft had a nearly five standard deviation move. Tesla ripped on a Wednesday when zero DTE options were available, which is no coincidence. 

Retail is rushing into the market buying calls, market makers are hedging by buying stock, and that feedback loop is compressing what should be months of movement into single sessions. 

It's a gamma squeeze, and it's being fueled entirely by zero DTE activity in the SPX, SPY, and QQQ.

Over 21 million contracts traded in just two products this week. That's not normal.

Here's what matters going forward: volatility found a floor. The VIX is lying dead on the ground, and if we continue higher next week, you're going to see days where the VIX is up with the market up. 

That's how fever-pitch the call buying has gotten, and when that happens, that's when real opportunities start presenting themselves. Not on the long side. On the short side.

I recorded my full weekend breakdown walking through exactly what happened. 

I break down the gamma mechanics with Microsoft as the example, show you the zero DTE open interest that's driving this, and walk through three specific sectors where I'm positioning short right now. 

I’m sharing what I'm doing with my own money.

Click here to watch the full breakdown