Core Concepts

⚙️ Core Concepts

🧩 Nodes

Heatseeker™ is built to reveal dealer exposure at each strike price and expiration. Each strike displays a value (positive or negative), and each value is represented by a color:

🔑 Key Principle

The most important factor is not whether a node is positive or negative — nor its color. What truly matters is the absolute value of the node.

💥 The larger the absolute value, the stronger the pull it exerts on price.

⚡ How Price Interacts with Each Node

• Positive Node → Lower-volatility interaction; price tends to move smoothly, with fewer wicks or spikes.

• Negative Node → Higher-volatility interaction; price becomes wicky and more violent. When price interacts with a negative gamma node, it can overshoot before reversing — this is how market makers often trap retail traders on the wrong side of the move.

🧲 Concept of Magnets

Every node on the Heatseeker map acts like a magnet in the market. Price is attracted to these zones due to dealer positioning — yet these same areas can also act as walls that repel price and create reversals.

🧠 Magnetic Behavior

• As price moves farther away from a high-value node → the magnetic pull weakens.

• As price approaches a high-value node → the magnetic pull strengthens.

• When price directly interacts with a node, a deflection or repulsion may occur — similar to when two positive ends of a magnet meet and push apart.

💡 Think of nodes as dynamic magnets — their influence grows as price converges and fades as it diverges.

👑 King Nodes

King Nodes are the highest absolute value nodes on the heatmap. They represent where Market Makers (MMs) hold the greatest exposure — and where price often gravitates near expiration.

🧭 Key Characteristics

• There can be multiple significant nodes with large values.

• When multiple strong nodes exist, they can pull in opposite directions, creating range-bound pinning or whipsaw movement.

📈 Price Behavior Around King Nodes

1. Pin Jobs (Common near End of Day) MMs often pin price near the King Node late in the session.

   • Tight ranges form.

   • Scalping the range edges tends to work best.

   
2. Drives Away (Common early in the day) When price reaches the King Node too early, MMs may push it away. Holding price there all session would require constant defense, so they often trigger an early drive-off.

⚠️ Margin of Interaction

King Nodes don’t always reject to the exact cent. Expect a deflection margin of roughly 5–10 points on SPX.

Note: A rejection occurring 5½ points away from the King Node is still considered valid, as noted in the example above.

🚪 Gatekeeper Nodes

Gatekeeper Nodes act like bouncers at the door of a nightclub — they prevent price from easily reaching the King Node.

These nodes function as deflection points that can cause major directional shifts.

🔍 Behavior

• If price tests and fails at a Gatekeeper Node → the map can reshuffle.

• Reshuffles often precede a trend change or realignment of where dealers aim to pin price.

• Gatekeeper rejections near the start of the day often mark high-probability reversals.

⚡ After rejection, reshuffles occur — and clarity emerges on the next directional bias.

⚖️ Midpoints

Midpoints are Market Makers’ favorite trap zones — and they offer the worst risk-to-reward for directional traders.

• Unless you’re an option or spread seller, avoid trading them.

📊 Why Midpoints Are Dangerous

• Market Dealers love range-bound conditions.

• The upper and lower ranges are easily visible on the heatmap.

• When price is in the middle of the range, direction becomes uncertain.

At best, your risk-to-reward is roughly 1:1 — not asymmetric and not worth taking.

✅ Better Strategy: Wait for price to approach the edge of the range and fade the edge. Fading extremes offers the best R:R and highest probability.

🔁 Price Delivery & Node Retests

When looking for bounce plays off a node, context matters — not all nodes retain influence forever.

🧮 Node Retest Strength

If price has already been delivered from a node (touched and moved away), its influence weakens. Each additional test reduces the likelihood of a strong bounce.

• Caption: ACN 240 node test, targeting upside nodes, from September 10th, 2025.

💡 Key Takeaway: Prioritize untouched nodes for bounce plays — treat previously tested ones with caution.

⚡ Robinhood Power Hour Liquidation

At 3:30 PM EST (30 minutes before market close), Robinhood begins auto-liquidating accounts that fail margin requirements. This creates forced order flow in highly liquid names like SPX, SPY, and QQQ.

💥 Why It Matters

• Triggers volatility spikes right before close.

• Can force breakouts or fakeouts near Gatekeeper Nodes.

• Near a King Node, can accelerate the move.

• Sometimes reshuffles the entire map.

⚠️ Always stay alert to Power Hour volatility — it’s often broker-driven and mechanical, not organic.

📈 Rate of Change of a Node

Heatseeker™ not only shows dealer positioning, but also how fast liquidity changes.

🔄 Reading Node Momentum

• Rapid Accumulation → Dealers are quickly adding exposure; acts like a magnet that pulls price in strongly.

• Rapid Unwinding → Exposure vanishes; levels that looked strong may suddenly weaken.

• Fast changes often cause volatility spikes, explosive moves, or sharp reversals.

🧠 Watch the rate of change — it reveals urgency and intent behind Market Maker adjustments.

🛡️ Hedge Nodes

Hedge Nodes appear during major news or macro events — such as FOMC, CPI, JOLTS, NFP, or earnings. They represent large, protective positions that sit farther from price and move slowly throughout the day.

Characteristics

• Typically static or slow-unwinding.

• Can appear above and below price simultaneously, typically far away from current spot price.

• Function like insurance rather than active magnets.

The closer a Hedge Node is to current price, the more it shapes intraday behavior. The farther it is, the less influence it exerts.

💡 Watch for gradual unwinds of large hedge nodes — they often signal changing Market Maker expectations.

🧨 OPEX Nodes

Every third Friday of the month marks OPEX Week — the monthly options expiration cycle.

What Happens During OPEX

• Nodes may carry less weight, since many contracts are set to expire.

• Positions roll off or reset, leading to temporary distortions in dealer positioning.

• After OPEX week passes, directional bias and map clarity typically improve immediately.

⚠️ Treat OPEX week levels with caution — probabilities are temporarily skewed.

✅ In Summary:

• Focus on absolute value — not color or sign.

• Favor untouched nodes over retested ones.

• Watch rate of change for clues on momentum.

• Avoid midpoints, respect gatekeepers, and track king nodes daily.

• Be mindful of external catalysts like Power Hour, OPEX, and Hedge Nodes.