Daily Meeting for Tuesday December 9

Understanding Convexity Colors, Session High Breakouts, and VIX-Based Fly Width Selection

• Users report browser freezes and “waiting for data” in Fly-on-the-Wall; Ernie explains it stems from prototype client-side code accumulating objects, and that moving to production code should eliminate these issues.

• A major instructional section explains color changes on the convexity heat map, showing how adjacent strike butterflies change cost and how rates of change determine red/blue intensity—illustrated with a hand-drawn bell curve analogy.

• Ernie breaks down session-high breakouts, describing the psychological “battle” won when a day’s high is broken, why elongated candles appear, and how volume-profile “crevices” can enable long, low-resistance runs.

• Questions about gamma walls and GEX bars lead Ernie to compare historical volume-profile structure with real-time open interest, noting when upside has “friendliness” and when a put wall can create strong gravitational pull.

• Members ask when to use 20-wide vs. 50-wide butterflies; Ernie anchors width to VIX level, showing the VIX-regime playbook (≈16.5 implies 20–30 wide) and demonstrating how identical “big-ass fly” pricing varies by volatility.

Summary

This unusually long session is primarily an in-depth lesson on how to read Fly-on-the-Wall’s visualizations and how volatility determines butterfly structure. After participants report freezes, Ernie attributes stalls to prototype browser code that keeps old objects in memory, noting the production build should be lighter and stable.

He then delivers a detailed explanation of convexity tiles: each tile shows the debit of a butterfly at a specific strike width; as you move away from at-the-money, debits shrink. Colors reflect the percentage change between adjacent butterflies, guiding traders to cheaper convexity opportunities rather than trading by color alone. He extends the teaching to gamma walls and volume profile, describing how real-time open interest piles up around historic nodes. A long digression on session-high breakouts translates structural moves into trader psychology—why breaking a morning high often gives bulls “permission” and forces shorts to capitulate.