05/05 SPX Weekly Playbook - GEX Zone Outlook🔮 What-If Scenarios for This Week – Based on GEX Structure until Firday
Last week’s market momentum pushed the S&P 500 up by almost 3%, effectively erasing the price gap left behind on Liberation Day. The index also strung together nine straight days of gains—something we haven’t seen since late 2004.
Meanwhile, implied volatility dropped significantly, with the VIX touching its lowest level since the holiday, falling to around 22.5.
Several factors seem to have fueled this bullish tone, including a more measured approach from Trump on trade policies and strong quarterly results from major tech names like Microsoft and Meta.
Still, the nature of the buying raises questions—was this a thoughtful rotation, or just a broad sweep of optimism?
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🔄 Chop Zone: 5650 – 5670 (wide transition zone)
🔹 Gamma Flip: 5615
🔺 Key Call Wall: 5725 (5800 potential shift)
🔻 Key Put Wall: 5500 (5400 major support below)
🔼 Upside Path
IF > 5670 → transition cleared →
➡️ 5700 stall / reaction
IF > 5725 → call wall breached →
➡️ Path to 5750 / 5775 → stall at 5800 (largest net call OI)
IF > 5800 → gamma resistance breaks down →
➡️ 5825/5850 zone opens up
🔽 Downside Path
IF < 5615 → gamma flip triggered →
➡️ 5500 = battle zone (massive put wall + high negative GEX)
IF < 5500 → negative gamma squeeze likely →
➡️ Stall zone: 5450 → flush to 5400
IF < 5400 → high-volatility regime →
➡️ Possible acceleration to 5375 / 5340 depending on IV spike
⚖️ Neutral Setup
IF 5650–5670 holds → dealer hedging = balanced →
➡️ Ideal for non-directional spreads / theta plays
➡️ Wait for breakout confirmation above 5670 or below 5615
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🔍 Final Thoughts
We’ve seen a sharp rally since the Trump trade war scare, with barely any meaningful pullback. The market appears to be looking for one—as a breath. Based on current GEX positioning, there’s significantly more downside hedging than upside, especially in the mid-term May expirations.
That doesn’t necessarily mean we crash—but it does mean that moves lower can accelerate faster, while upward breakouts may require more energy or time. In this environment, consider:
Bearish or neutral spreads (put debit spreads, call credit spreads)
Volatility-based strategies
Avoiding naked upside trades unless we see a strong reclaim of 5725+
Stay safe and adapt—GEX doesn’t tell direction, but it does tell where the fire might start, beacuse of reflexting to hedging activity.
