💡 GEX Patterns & Concepts
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1. The King Strike Effect
When the stock is near the King Strike and overall GEX is positive, a pinning effect is commonly observed. Dealers continuously buy dips and sell rips, creating hedging pressure that tends to pull price toward that strike.
💡 Historical Observation: When price is within 0.5% of the King Strike and GEX is positive, historical data shows an increased tendency for mean-reversion behavior — this is a mechanical consequence of dealer hedging, not a guarantee.
2. The Gamma Flip Level
The Gamma Flipis the price level where net GEX flips from positive to negative. Below the flip, dealers' hedging tends to amplify moves; above it, hedging tends to dampen moves.
- Above Gamma Flip → Positive GEX environment. Dealer hedging tends to dampen volatility, often favoring range-bound behavior.
- Below Gamma Flip → Negative GEX environment. Dealer hedging tends to amplify moves, often resulting in sharper price action.
💡 How to Spot It: The heatmap shows the Gamma Flip automatically: look for the ⚡ badge on the strike column and the orange dashed line across the row. The header bar also displays ⚡ Flip: $XXX next to the King Strike.
3. Expiration Day Dynamics (OpEx)
As options approach expiration, their gamma increases dramatically (especially for ATM options). This means the leftmost column in the heatmap has the most hedging impact.
- 0DTE / same-week expiry — Extremely high gamma. Price tends to cluster around high-OI strikes intraday.
- After expiration — Those contracts vanish. The GEX landscape can shift dramatically overnight. Always recheck the heatmap after every OpEx.
- Monthly OpEx (3rd Friday) — The largest gamma unwind of the month. Increased volatility is often observed the following Monday as the GEX landscape resets.
4. Dashboard Metrics
The summary bar at the top of the heatmap shows six key metrics for an instant snapshot of the overall options landscape:
- GEX Ratio — Balance between call and put gamma. Above 50% = calls dominate (stabilizing). Below 50% = puts dominate (amplifying).
- Net GEX — Total gamma exposure in dollar terms. Positive = dampening, negative = amplifying.
- IV Ratio — Are calls or puts relatively more expensive? Based on OI-weighted implied volatility. For index ETFs, sub-50% is normal due to structural put skew.
- Net IV — Absolute IV difference between calls and puts. Positive = calls more expensive; negative = puts more expensive.
- P/C OI — Put/Call open interest ratio. Above 1.0 = more puts than calls.
- Volume — Day volume for calls and puts, showing current session activity level.
💡 Multiple metrics pointing in the same direction provide a more complete picture. When they diverge, the positioning data is less conclusive.
5. Fixed-Strike IV Confirmation
GEX tells you where dealer hedging pressure should exist based on open interest. Fixed-strike IV tells you what the market is actually pricing at that level — observable supply and demand for risk.
- GEX level + IV crushing at that strike → No breakout demand. The GEX level appears confirmed by observable vol.
- GEX level + IV elevated and rising at that strike → Active demand for options at that level. The GEX level alone may not tell the full story.
IV badges on key strikes (King, Flip, Current Price) show real-time call/put IV with trend arrows (▲/▼). Click any cell for the full IV history over 5m, 15m, 30m, 1h, 2h, and 4h.
🔬 The analysis panel includes an automatic "🔬 Fixed-Strike IV Confirmation" section that checks whether IV behavior at key GEX levels aligns with or diverges from the GEX signal.
6. Dark Cells = Key Levels
The darkest cells on the heatmap represent the highest GEX concentration:
- Dark blue row→ Major call wall. Dealers' hedging at this level tends to resist price moves through it.
- Dark green row → Major put wall. If price reaches this level, dealer hedging may accelerate the move.
- Cluster of dark cells at one strike → Multiple expirations aligned at the same strike = a very persistent level with layered hedging pressure.
7. Intraday GEX Shifts
GEX isn't static — it changes throughout the day as options are traded, prices move, and OI shifts. GammaBaba auto-refreshes to capture these changes.
- Click any cell → See how the GEX value changed over 1m, 5m, 15m, 1h, and 4h.
- A cell that was light but is now getting darker means new positioning is building at that level.
- A King Strike that shifts during the day indicates large new positions being opened, shifting the center of dealer hedging.
8. Common Patterns — Cheat Sheet
| Pattern | What It Reflects | Typical Characteristic |
|---|---|---|
| Price at Blue King | Max hedging pressure zone | 🧲 Lower vol, tight range, mean-reversion tendency |
| Price below Gamma Flip | Negative GEX territory | 🔥 Trend continuation tendency, higher vol |
| King Strike shifts up | New call OI building higher | 📈 Upward repositioning observed |
| King Strike shifts down | New put OI building lower | 📉 Downward repositioning observed |
| All columns dark at one strike | Multi-expiry convergence | 🧱 Very persistent GEX wall with layered hedging |
| 0DTE column dominates | Same-day gamma is very high | 📌 Intraday pinning tendency, resets after close |
| Large green below spot | Big put wall beneath price | 💨 Dealer hedging may accelerate decline if breached |
| GEX decreasing overall | Fewer dealer hedging obligations | ⚡ Higher realized vol environment likely |
| Call wall + call IV crushing ▼ | No breakout demand at resistance | ✅ GEX level and vol data aligned |
| Call wall + call IV elevated ▲ | Upside demand despite GEX ceiling | ⚠️ Vol data diverges from GEX — worth monitoring |
| Put wall + put IV falling ▼ | Hedging demand fading at support | ⚠️ Wall may be weakening — vol demand declining |
9. What GEX Cannot Tell You
GEX is a useful analytical lens, but it has clear limitations:
- Direction — GEX shows where hedging pressure exists, not which direction the stock will move.
- Timing — A strong GEX level may hold for hours or be broken in minutes by a catalyst (earnings, news, macro events).
- Hidden positions— OTC options, exotic structures, and dark pool activity don't appear in GEX data.
- Post-market changes — After-hours trading can move price beyond GEX levels before the next session.
- Dealer positioning assumption — GEX assumes a specific model of who is long and short gamma. Use fixed-strike IV to check whether observable market behavior aligns with the model.
💡 GEX is one analytical tool among many. It's most informative when combined with price action, volume, and broader context. Fixed-strike IV adds another dimension — when GEX and IV data align, the level has stronger analytical support.
🔑 Key Takeaways
- GEX is an analytical tool — it maps hedging pressure, not future outcomes
- The King Strike is your reference point: proximity correlates with pinning behavior
- Above Gamma Flip = dealer stabilization tendency; below = amplification tendency
- GEX shifts in real-time — the landscape changes throughout the day
- Monthly OpEx (3rd Friday) is the biggest gamma unwind — the map resets afterward
- Dark cells across multiple expirations at one strike = strongest level on the board
- Dashboard metrics (GEX Ratio, IV Ratio, volume) add context when read together
- Cross-reference GEX with fixed-strike IV: when they align, the level has stronger support
- GEX shows positioning, not direction — always consider it alongside other data