The Dog Days are Over! – GME Trading Day 8/9 Reflection and 8/12 Price Movement Analysis

Welcome back everyone to another price movement analysis and discussion here on Superstonk!

Sing, O Muse, the Rage of a Kitty!

As the Dog Days of Summer are now officially over, we are taking a look today at what we can expect heading into August OPEX – a big week for traders looking into their black mirrors and crystal balls to try set up for late August's potential IV run-up in advance of GME's much anticipated Q2 earnings report. Let's see what traders and Market Makers have set up for us today and this week!

8/9 Reflection

As mentioned last week, our stabilized, positive gamma regime kept things nice and easy for us throughout last Friday's trading date. Things were a little bit more jumpy than the previous day, but we stayed bound to a pretty tight $21.50-$22 range with an early lower-bound establishing dip to $21.43 and a midday upper-bound establishing rip to $22.17 setting up a refreshing (and somewhat surprising) bullish close *above* our $21.50 Max Pain:

8/9 Trading Day 1min Aggregation

8/12 Outlook

We have a new week and a fresh gamma wipe. However, as I mentioned last week before our open, we did not have much gamma coming off the board relative to our totals as we approach this week's OPEX. I quote myself:

Post URL: https://www.reddit.com/r/Superstonk/comments/1enyaxf/price_recovery_inbound_gme_88_trading_reflection/

This OI did not change too dramatically as a result of last Friday's trading, but there are several levels that saw some notable OI reconfiguration heading into this week:

8/16 OI Changes from 8/9 to 8/12

The two areas I've highlighted above gesture to OI changes which I expect to shift the gamma exposure balance of the hedging landscape. Again, the overall shape and character of this landscape which I pointed to last Friday has not largely changed, but the above levels – at least off the open – are the areas of most notable local comparative change. This is reflected in the GEX data:

8/12 GEX by Strike

Are principle shape is as follows: major upside overhead resistance at $25, local volatility suppression at $22, stable gamma-neutral trading between $20 and $22 with downside support at $20. Gamma flip line sits at $19.50 on a downside move, but there is still not much downside volatility built into the options change. Traders could decide to build out our lower range in order to prepare for some sort of downside volatility event, but for right now – based on last Friday's OI changes especially – it looks like they are gearing up for intra-week options flows to either test and reject $22, giving us a repeat of our end-of-week trading bracket from our 8/9 expiry or build up some upward pressure to take us over $22, transform it back into a downside support and set up a $25 test on Wednesday or Thursday. Max Pain is at $22 right now, but this would likely change on an options-flow induced bubble-up to test $25. A close above this level is highly unlikely as for now.

Forward-Looking Remarks

It is important to reflect as well on our broader market conditions heading into August OPEX, namely that the negative gamma exposure conditions and potential for downside volatility that realized after the Nikkei crash last Monday pre-market has not dissipated from SPY/SPX. If you subscribe to Spotgamma's newsletter, you can see a full digest of this, but Kochuba and company out there have come out point blank and said that moves back to SPX 5000/SPY 500 given the right informational externality are possible. For the meantime 530 stands as a strong normalized-conditions support, but the right sort of 'uh-oh' news could send us back down the ladder. Therefore, in the broader context, the type of 'bottom drop-out' we saw last Monday is still a possible broader market move and we should expect that, if it does, we might see some short-term GME sympathy dipping in the case of such an event.

This does not predicate any bad news for the stock or unseat any of the mid-term upward volatility analyses. This is only to bring up some conditions that might materialize as short-term downside volatility such as not get blind-sided.

As I mentioned last week from a tin-foil/DFV symbolic tea leaf reading, the dog days of Summer are together with the Olympics (Aug 11) now over. All eyes in the symbolic domain will thus likely turn to a potential run-up to the completion of the Dogstar Satellite Music Radio and American Flag Media Company (McEnroe: You have GOT to be SIRIUS!) which is expected to take place around the same time as the GME Q2 Earnings report. GME Q2 earnings – which is likely going to be a significant improvement YOY with all of the new cash on hand from the ATMs and interested from their associated treasuries – is confirmed for Wednesday September 4. Once August OPEX is in the rearview, I wouldn't be surprised to see a notable IV build up over the 2nd half of August as we approach this next crucial milestone for the Superest of all Stonks.

As always, I will remind you that this is neither trading nor financial advice. I'm regarded and a random internet dude. I write about the structure of the trading day on a regular basis to try to gain insight into our day-to-day price action and cultivate preparedness to detect any anomalies that pop-up in the options data regarding $GME. If you find this content helpful or useful, please leave a comment, upvote, and share! I'm happy to entertain all questions, points of discussion, rebuttals etc. Good luck with your trades!

Cheers

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Post Scriptum: A special thank you once again to our award-donors: user HostIntelligent once again sent in an award for the fifth time in as many days. Thank you, friend for your continuing support of our discussions here. We had awards from four other users as well including nishnawbe61. Thank you for your continued support and all of you taking part in the comments and discussion.

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Thank you again, everyone! And thank you for making this an excellent spot to share information, discussion, and community as we all try to learn more about the market and GME!

Edit: Typos