01 — The mechanic
Start with delta, then gamma
Delta is how much an option's price moves when the underlying moves one point. Gamma is how fast that delta itself changes as price moves. That's the whole definition — gamma is the rate of change of delta.
Why does it matter for price? Because of who is on the other side of your trade. When a market maker sells you an option, they don't want a directional bet — they hedge it by trading the underlying to stay delta-neutral. But as price moves, the option's delta changes (that's gamma), so the dealer has to keep re-hedging, buying and selling the underlying continuously. That hedging flow is real order flow, and it pushes price around. Gamma is the dial that decides which way.
02 — The two regimes
Pin, or accelerate
There are only two states, and they behave in opposite ways. The line that separates them — where the market flips from one to the other — is the gamma flip.
Dealers hedge against the move — sell into rallies, buy into dips. That flow dampens volatility. Price gets sticky and tends to pin near the big strikes. Quiet, mean-reverting tape.
Dealers hedge with the move — buy into rallies, sell into dips. That flow amplifies volatility. A small push snowballs — the "why did it just rip" mechanic. Trend days and air-pockets live here.
Knowing which regime you're in tells you the character of the day before the day tells you: absorb-and-fade, or press-and-go. It does not tell you direction.
03 — Why 0DTE
Why 0DTE makes it violent
Gamma is largest for at-the-money options that are close to expiry. A 0DTE (zero-days-to-expiry) option has only hours to live, so right at the money its gamma is enormous. When a huge notional of 0DTE gamma piles up at one strike, dealers must re-hedge aggressively for even tiny moves — and then, just past that strike, the gamma falls off a cliff and the hedging flow vanishes.
That's the modern intraday signature everyone feels but few can name: a violent reaction right at a level, then thin air above or below it. It isn't random. It's a wall of expiry gamma being defended, and then abandoned.
04 — The discipline
How to read it — not trade it
Gamma is context, not a signal. A gamma map tells you where price is likely to react — but never whether to buy or sell. It's a map of the terrain, not a direction to walk.
Knowing where dealer hedging concentrates tells you where price is likely to pin or accelerate. What you do with that terrain is your decision, and yours alone. That's the line that keeps education on the right side of a signal.