Learn · options market structure
What is the gamma flip level?
The gamma flip is the price at which estimated net dealer gamma changes sign from positive to negative. Above it, dealer hedging tends to dampen moves; below it, hedging tends to amplify them. It is a model estimate that shifts as open interest and price change.
Dealers amplify moves: trending and higher intraday volatility.
How it is found
Recompute net gamma exposure at a range of hypothetical prices and find where the total crosses zero. Because it depends on the dealer-positioning assumption, different providers can place it a little differently.
Why it matters
Crossing the flip often coincides with a change in how the market trades: from range-bound and mean-reverting to trending and more volatile, or back.
Related
- What does negative gamma mean for the stock market?
- What is gamma exposure (GEX)?
- What are gamma walls in options?
Education and market data, not investment advice. GammaPulse does not publish a track record or performance claims.