Traders say “we’re in long gamma” when they mean the dealer book is positioned to sell strength and buy weakness near spot — a pinning bias. “Short gamma” means the opposite: hedges chase the move. The practical marker on an options desk is where cash sits relative to the zero-gamma (0Γ) strike.
Spot vs 0Γ
- Spot ≥ 0Γ → dealers tend to be long gamma above the flip — mean-reversion / pin behavior more common.
- Spot < 0Γ → short gamma below the flip — trends and stops can accelerate.
- The flip itself moves when large strikes trade or when the chain thins away from the money.
What to watch after the flip jumps
A jump in zero-gamma is often a regime rewrite, not noise — especially on NDX where the book is narrower. Re-check call/put walls and Net GEX sign on both Vol and OI before you treat the old map as current.