Gamma Exposure (GEX)
The aggregate hedging pressure options dealers face as price moves — positive gamma pins price to big strikes, negative gamma accelerates moves away from them.
What is gamma exposure?
Gamma exposure (GEX) measures how much options dealers must buy or sell the underlying to stay hedged as price moves. Dealers who sold puts and bought calls hedge dynamically: when they are net LONG gamma, their hedging opposes price movement (buy dips, sell rips) — dampening volatility and pinning price near big open-interest strikes. When net SHORT gamma, hedging amplifies movement (sell into weakness, buy into strength) — fueling trend days and violent ranges.
The map has landmarks: the call wall (strike with dominant call OI — hedging supply caps rallies there), the put wall (dominant put OI — hedging demand cushions selloffs), and the gamma flip level, where the regime crosses from positive to negative and price behavior changes character.
Trading the gamma regime
Regime first, trade second: in positive gamma above the flip, fade extremes toward the pin — mean-reversion setups like EQ bounces thrive; in negative gamma below the flip, respect momentum — breakouts run and dip-buying is fighting dealer flows. Walls double as liquidity landmarks: the call wall often coincides with buy-side external liquidity, and the interaction (sweep vs expansion) is decided partly by dealer positioning.
GEX also frames event risk: large expirations reposition the entire map, which is why behavior around monthly OPEX shifts — pins release, and price is freer to seek liquidity.
How Pushing Profits applies it
The platform computes live dealer GEX/VEX by strike — call wall, put wall, and flip level — and displays them as a ladder on price. Signals read the regime: mean-reversion setups score higher in positive-gamma conditions, momentum flows in negative, and the walls join the liquidity map as targets and barriers.
Frequently asked questions
Why does price 'pin' to certain strikes on Fridays?
Near expiration, gamma concentrates at big-OI strikes. In positive-gamma conditions dealer hedging pushes price back toward those strikes from both sides — the pinning effect strongest into monthly OPEX.
What is the gamma flip level?
The underlying price where aggregate dealer gamma crosses from positive to negative. Above it, hedging dampens moves; below it, hedging amplifies them. Crossing the flip often visibly changes intraday character.
How do GEX walls relate to liquidity pools?
They stack: a call wall just above equal highs means dealer supply AND stop-driven demand collide there — a common spot for sweeps that fail. Reading both layers beats reading either alone.