The level where dealer hedging stops damping the market and starts feeding it.
Market makers who have sold options hold the other side of every position a trader carries, and hedge in the underlying to stay neutral. The direction of that hedging depends on the sign of their aggregate gamma, not its magnitude. A very large positive number and a very large negative number describe opposite markets.
Dealers long gamma sell into rallies and buy into dips, because that is what keeps them delta-neutral as price moves. The effect is mechanical and it compresses realised range. Breakouts need more fuel than usual and moves that would run on another day stall.
The same mechanism inverts. Dealers short gamma must sell as price falls and buy as it rises, so selling begets selling and a move that starts small extends. This is why range and direction are separate questions: the flip tells you which kind of session the book is set up for, not which way it goes.
Nothing on this page has been measured walk-forward in this product. Gamma at a strike is also partly endogenous to price, open interest builds at strikes price is approaching, so "the node pulled price up" may have the causality backwards.
The price level at which market makers’ aggregate gamma crosses from positive to negative. Above it their hedging leans against price, selling rallies and buying dips, which compresses range. Below it the same hedging runs with price, which extends moves. It is a statement about how a market will behave, not about which way it will go.
No, and this is the most common misreading of it. The flip separates a damping regime from an amplifying one. A market can fall steadily above its flip and rally hard below it. What changes across the level is the character of the move, not its direction.
Gamma per strike is computed from the option chain and open interest, signed by an assumption about which side of each contract the dealer holds, then summed. The flip is where that running total crosses zero. The assumption about dealer side is the weak link in every version of this calculation, which is why the sign of the result deserves more trust than its exact magnitude.
Every session, and sometimes intraday, because it depends on an option chain that is being traded. It also tends to move toward price rather than away from it, since open interest builds at strikes the market is approaching. The live block on this page shows the current reading and when it was computed.
Dealer gamma across the expiry curve, and a written read every session.
CREATE A FREE ACCOUNT, NO CARD