GEX Tracker

GEX Trading Strategies

Master professional trading techniques using Gamma Exposure analysis. Learn how market makers position themselves and turn that knowledge into profitable trades.

Quick Reference Guide

🟢 Positive GEX (Support/Resistance)

  • • Effect: Price stabilization - acts as a magnet
  • • Market Maker Action: Buy dips, sell rallies
  • • Trader Opportunity: Mean reversion, range trading
  • • Best For: Selling premium, tight stop losses

🔴 Negative GEX (Breakout Zones)

  • • Effect: Price acceleration - amplifies moves
  • • Market Maker Action: Buy rallies, sell dips
  • • Trader Opportunity: Trend following, momentum
  • • Best For: Buying options, trailing stops

Strategy Categories

Beginner Foundation Strategies

Support & Resistance Identification

Neutral

Use the largest positive GEX bars as key price levels where the stock is likely to find support or resistance.

How to Trade:

  • 1. Identify top 3 highest positive GEX levels
  • 2. Wait for price to approach these levels
  • 3. Look for reversal signals (candlesticks, volume)
  • 4. Enter mean reversion trades with tight stops

Risk: Low | Win Rate: 60-70% | R:R: 1:1 to 1:2

Zero Gamma Level Trading

Breakout

Trade the transition from positive to negative gamma as price crosses the zero GEX level - a key inflection point.

How to Trade:

  • 1. Note the zero gamma level on your chart
  • 2. Watch for price approaching this level
  • 3. Expect increased volatility near this zone
  • 4. Trade breakouts above/below with momentum

Risk: Medium | Win Rate: 50-60% | R:R: 1:2 to 1:3

GEX Confirmation

Confirmation

Enhance your existing technical analysis by confirming support/resistance with GEX levels for higher conviction trades.

How to Trade:

  • 1. Perform your normal technical analysis
  • 2. Check if key levels align with high GEX
  • 3. Increase position size when aligned
  • 4. Use tighter stops when not aligned

Risk: Low | Win Rate: 65-75% | R:R: 1:1.5

Intermediate Advanced Techniques

Volatility Breakout Play

Directional

Trade explosive moves when price breaks through negative gamma zones where market makers amplify momentum.

How to Trade:

  • 1. Identify negative GEX zones on chart
  • 2. Wait for price to approach these areas
  • 3. Enter on volume confirmation breakout
  • 4. Use trailing stops to capture trend

Risk: Medium-High | Win Rate: 45-55% | R:R: 1:3+

GEX Ladder Strategy

Multi-Level

Scale into positions at multiple GEX levels to build a high-probability trade with favorable risk/reward.

How to Trade:

  • 1. Identify 3-4 significant positive GEX levels
  • 2. Enter 25% position at each level
  • 3. Set stop below all GEX levels
  • 4. Take profits at negative GEX zones

Risk: Medium | Win Rate: 55-65% | R:R: 1:2

Expiration Week Squeeze

Event-Based

Trade the gamma squeeze effect in the week leading up to major option expiration when GEX concentrations are highest.

How to Trade:

  • 1. Focus on weekly expirations
  • 2. Find highest GEX strike (max pain)
  • 3. Trade towards this level Mon-Thu
  • 4. Exit before Friday's pin risk

Risk: Medium | Win Rate: 60-70% | R:R: 1:1.5

Advanced Professional Techniques

Delta-Neutral GEX Hedge

Hedging

Create market-neutral positions that profit from GEX-driven price action regardless of direction.

How to Trade:

  • 1. Sell options at high positive GEX strikes
  • 2. Buy stock to create delta-neutral position
  • 3. Rebalance as price moves toward GEX level
  • 4. Profit from theta decay + mean reversion

Risk: Low-Medium | Win Rate: 70-80% | R:R: 1:1

GEX Flip Momentum

Reversal

Capitalize on regime changes when market transitions from positive to negative GEX or vice versa.

How to Trade:

  • 1. Monitor total GEX (all strikes combined)
  • 2. Watch for flip from net positive to negative
  • 3. Enter long volatility trades (buy options)
  • 4. Expect larger price moves post-flip

Risk: High | Win Rate: 40-50% | R:R: 1:4+

Multi-Expiry GEX Arbitrage

Complex

Exploit differences between near-term and long-term GEX positioning to capture calendar spread opportunities.

How to Trade:

  • 1. Compare weekly vs monthly GEX levels
  • 2. Look for misalignment in positioning
  • 3. Use calendar spreads at divergent strikes
  • 4. Profit from convergence over time

Risk: Medium | Win Rate: 55-65% | R:R: 1:2

⚠️ Risk Management Guidelines

Position Sizing Rules

  • • Never risk more than 1-2% of capital per trade
  • • Size positions smaller in negative GEX zones (higher volatility)
  • • Use wider stops in low liquidity environments
  • • Scale in gradually at multiple GEX levels

When NOT to Trade GEX

  • • Low open interest (< 1000 contracts at strike)
  • • Major news events overriding technical levels
  • • Extreme market conditions (VIX > 40)
  • • Illiquid underlying securities

Example Trade Setups

SPY Mean Reversion at High GEX

Beginner-Friendly

Setup

  • • SPY trading at $580
  • • Highest GEX at $575 (+$15M)
  • • Price pulls back to $576
  • • Support on daily chart at $575

Entry & Management

  • • Buy SPY $577 call, 7 DTE
  • • Entry: $2.50 per contract
  • • Stop: Below $574 (-40%)
  • • Target: $582 (+100%)

Rationale

  • • High GEX acts as support
  • • Market makers will buy dips
  • • Technical confluence
  • • Favorable R:R ratio

NVDA Volatility Breakout Play

Intermediate

Setup

  • • NVDA at $140
  • • Zero GEX level at $142
  • • Negative GEX above $142 (-$8M)
  • • Consolidation pattern forming

Entry & Management

  • • Buy NVDA $145 call on break of $142
  • • Entry: $3.00 per contract
  • • Stop: $141 (-33%)
  • • Target: $150 (+200%)

Rationale

  • • Negative GEX amplifies moves
  • • MM hedging accelerates breakout
  • • Clear risk/reward structure
  • • Momentum in our favor

Common Mistakes to Avoid

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Trading Every GEX Level

Focus on the most significant levels with highest open interest. Quality > quantity.

❌

Ignoring Market Context

GEX doesn't work in isolation. Always consider broader market trends and news.

❌

Overleveraging Positions

GEX increases probability but doesn't guarantee success. Stick to proper position sizing.

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Chasing After Price Moves

Wait for price to come to your GEX level, don't chase it after it's already moved.

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No Stop Loss Plan

Always define your risk before entering. GEX levels can fail.

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Trading Illiquid Options

Stick to highly liquid underlyings like SPY, QQQ, major tech stocks.

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