How a Decrease in Implied Volatility can Lead to a Huge Rally | SPX 0DTE Options

A significant spike in Implied Volatility, followed by a decrease in IV, with extremely high negative Gamma Exposure (GEX) right before a critical Option Expiration date, can often lead to big rallies in the SPX. Once you understand the correlation and spot the divergence between price, GEX, and IV, you will have an excellent opportunity for significant, outsized returns using 0 or 1 DTE options. I use the VIX as a proxy for IV. Here is a brief excerpt from the CBOE website on the VIX, "The VIX Index generally tends to have an inverse relationship with the S&P 500 Index and historically when the S&P 500 Index declines the VIX Index generally tends to increase. Simply put, the VIX Index tells us the level of expected volatility of the S&P 500 Index for the next 30 days, with a 68% confidence level, or a one standard deviation of the normal probability curve." https://bit.ly/cboe-vix-correlation Gamma Exposure (GEX) Playlist https://bit.ly/gex-playlist How to use OptionStrat (Risk Profile) https://youtu.be/oIp67uJFmJ0 Discord: https://quanttradingdiscord.com Website: https://quanttradingapp.com Book a 1-on-1 Zoom screen share meeting with me https://bit.ly/tradinglitt-calendar QTA Thinkorswim Studies https://bit.ly/qta-tos-studies TOS Studies Installation Guide https://bit.ly/qta-tos-studies-installation 00:00 Intro Chapters: 00:21 Daily Timeframe SMA 02:10 Overview 05:25 VIX & SPX Divergence 21:16 SPX & SPY Gamme Exposure 30:51 Archived GEX 39:58 Trading the SPX Options 50:09 Conclusion #DayTrading #impliedvolatility #OptionsTrading ————————————————————————————————————— Find me other places: https://instagram.com/tradinglitt https://twitter.com/tradinglitt ————————————————————————————————————— FTC: This video is not sponsored. However, I am the lead developer at QuantTradingApp.com. DISCLAIMER: I am not a certified financial advisor, and nothing in this video or text is an advertisement or recommendation to buy or sell any financial instrument. This video is for educational purposes only.