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FREE GUIDE · GAMMA LEVELS

Gamma levels, explained
in five minutes

Why NQ and ES keep stalling, bouncing and speeding up at the same prices, and how to read the call wall, the gamma flip and the put wall before the New York open.

01 · The idea

Dealers hedge. Their hedging moves price.

When traders buy and sell options, market makers take the other side. To stay neutral they hedge with futures and stock, and how much they need to hedge changes as price moves. That change is gamma.

Where open interest is heavy, that hedging is heavy too. Those strikes become the prices the market keeps reacting to. Gamma levels are simply a map of where that pressure sits today.

02 · The levels

Four levels worth knowing every morning

Call wall

The ceiling

The strike with the most call gamma above price. As price climbs into it, dealer hedging tends to sell into strength, so it often acts as resistance or a magnet that caps the day.

Look for stalls and rejections into it. A clean break and hold above can open the next big strike.

Gamma flip

The line that changes the regime

The price where total dealer gamma switches from positive to negative. It splits the map into two very different kinds of days.

Above it, moves tend to be slower and rotate. Below it, moves tend to speed up and trend.

Put wall

The floor

The strike with the most put gamma below price. Hedging flows often support price into it, so it frequently acts as support on the first test.

If it breaks and price holds below, selling can accelerate because hedging now pushes in the same direction.

Big strikes

The steps in between

Other strikes with heavy open interest. Price often pauses, wicks or reverses at them, which makes them useful for targets and partials.

Treat them as areas, not exact ticks. Use them to plan where a move might pause.

03 · How to use them

A simple three-step routine

01

Mark the map before the open

Put the call wall, gamma flip, put wall and the biggest strikes on your chart before New York opens. The levels are known before the session starts.

02

Read the regime

Is price above or below the gamma flip? Above: expect rotation, fade the extremes. Below: expect faster moves, respect breaks and don't fight momentum.

03

Let price confirm

A level is a place to watch, not a signal. Wait for a reaction at the level (a held test or a held break), then plan the stop beyond it and the target at the next level.

04 · Avoid these

Three common mistakes

Trading the level blindly

Levels show where hedging pressure sits, not what price will do. Always wait for confirmation.

Using yesterday's levels

Open interest changes every day. Old levels can be in the wrong place by the next morning.

Forgetting the conversion

Options levels come from SPX, NDX, SPY or QQQ. They have to be converted to ES and NQ futures prices before they mean anything on your chart.

HOC TERMINAL

Get today's gamma levels for NQ and ES

Every morning the HOC Terminal puts the call wall, gamma flip, put wall and the big strikes on your chart, already converted to futures prices, next to the day's game plan.

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