【SMC Lesson · Trading Positive and Negative Gamma Ranges】
Many people ask: Why does the price keep bouncing back and forth within a certain range?
That’s a characteristic of a “positive Gamma range.”
📌 Core logic:
Market makers need to dynamically hedge their positions before options expire. When the strike prices of a large number of options are concentrated in a certain area, market makers are forced to trade in the opposite direction—selling when prices rise and buying when they fall, effectively “pinning” the price around the center.
✅ Positive Gamma environment (high concentration of options expiring in 1–5 days):
→ Prices revert to the mean and trade within a range, with many false breakouts
→ Strategy: Open positions against the move near the range boundaries; get in and out quickly
❌ Negative Gamma environment (after expiry/options have been fully cleared):
→ Market makers no longer suppress price action; prices move directionally and can surge one way
→ Strategy: Follow the move after a breakout is confirmed; don’t fight the trend
🎯 Current BTC example (74676U):
Over the past 3 days, BTC has been tightly confined to the 73510–76200 range, with a price swing of less than 3.6%—a classic sign of positive Gamma suppression.
Key price levels:
· Upper resistance: 75500–76200 (concentrated market-maker selling pressure)
· Lower support: 73500–74000 (market-maker buying interest)
· Midpoint pivot: around 74850 (high-frequency price magnet)
📌 Actionable takeaway:
The current price of 74676U is in the lower half of the range. In a positive Gamma environment, prioritize mean-reversion trades—consider going lightly long around 73800–74000, with a target of 75500. If a large volume of options expires and is cleared in the next cycle, and Gamma shifts negative, abandon the range-trading approach and wait for a directional breakout before following the trend.
Follow me for a livestream and SMC lessons every evening at 21:00.
🌿 Zhao | Not financial advice
Many people ask: Why does the price keep bouncing back and forth within a certain range?
That’s a characteristic of a “positive Gamma range.”
📌 Core logic:
Market makers need to dynamically hedge their positions before options expire. When the strike prices of a large number of options are concentrated in a certain area, market makers are forced to trade in the opposite direction—selling when prices rise and buying when they fall, effectively “pinning” the price around the center.
✅ Positive Gamma environment (high concentration of options expiring in 1–5 days):
→ Prices revert to the mean and trade within a range, with many false breakouts
→ Strategy: Open positions against the move near the range boundaries; get in and out quickly
❌ Negative Gamma environment (after expiry/options have been fully cleared):
→ Market makers no longer suppress price action; prices move directionally and can surge one way
→ Strategy: Follow the move after a breakout is confirmed; don’t fight the trend
🎯 Current BTC example (74676U):
Over the past 3 days, BTC has been tightly confined to the 73510–76200 range, with a price swing of less than 3.6%—a classic sign of positive Gamma suppression.
Key price levels:
· Upper resistance: 75500–76200 (concentrated market-maker selling pressure)
· Lower support: 73500–74000 (market-maker buying interest)
· Midpoint pivot: around 74850 (high-frequency price magnet)
📌 Actionable takeaway:
The current price of 74676U is in the lower half of the range. In a positive Gamma environment, prioritize mean-reversion trades—consider going lightly long around 73800–74000, with a target of 75500. If a large volume of options expires and is cleared in the next cycle, and Gamma shifts negative, abandon the range-trading approach and wait for a directional breakout before following the trend.
Follow me for a livestream and SMC lessons every evening at 21:00.
🌿 Zhao | Not financial advice