Trading Glossary
Key terms for options flow analysis, gamma exposure, dark pool trading, and institutional order flow.
The longer answers live in the guides: what the dark pool index (DIX) measures, what gamma exposure is, what options flow is, and how dark pool trading works.
Daily indicator tables by symbol: technical indicators by ticker.
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- Absolute Gamma Strike, where hedging concentrates, and why this is not the call wall
- What Is a Call Sweep? Options Sweep Meaning, the order type behind the name, and what the print cannot carry
- Call Wall, the positioning it assumes, and why it is a model output rather than an order
- What Is the Expected Move? Two Calculations, the two calculations, and when they disagree
- Failure to Deliver (FTD), what the SEC publishes, and what it is not evidence of
- Gamma Pinning, the condition the pinning models require, and how pin risk differs
- What Is a Gamma Ramp in Options Trading?, the positioning the accelerant story assumes, and the trade the convention implies
- Gamma Skew, three ideas sharing one name, and which one your screen means
- What Is a Golden Sweep in Options Flow?, a platform label rather than a market term, and what it does not establish
- Hedge Wall, a proprietary level, and what can honestly be said about one
- What Is IV Crush in Options Trading?, sizing the drop before the event, and why direction alone does not save the trade
- Market Tide, what the curve aggregates, and where cumulative flow measures mislead
- Net Premium, an inferred buy and sell split, and how spreads distort it
- What Is OPEX in Trading? Options Expiration, how third-Friday SPX settlement works, and what actually changes at expiry
- Option Multiplier, who sets it, and the cases where it is not 100
- Payment for Order Flow (PFOF), price improvement and the conflict of interest, and what both mean for flow data
- Put Wall, why the usual dealer-buying explanation for it is backwards
- Rule of 16, the square-root-of-252 arithmetic, and where the shortcut breaks
- What Is Short Interest in Stocks?, the reporting lag, the two ratios, and how it differs from short volume
- What Is the Sizzle Index? thinkorswim Ratio, the thinkorswim ratio, and the blind spot it hides
- Vanna Exposure and Charm Exposure, the two dealer-delta numbers that move when price does not
- Zero Gamma, the sign convention most explainers get backwards, and why the level is an assumption
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0DTE
Zero Days to Expiration, options contracts expiring on the current trading day. 0DTE options now account for over 40% of SPX options volume.
B
Backwardation
When futures prices are lower than the spot price, creating a downward-sloping curve. VIX backwardation signals extreme current fear and is often seen during market crashes.
Block Trade
A large options order negotiated privately between two parties, then reported to the exchange. Blocks typically involve 10,000+ contracts.
C
Call Wall
the positioning it assumes, and why it is a model output rather than an order, full definition
Contango
When futures prices are higher than the spot price, creating an upward-sloping curve. In VIX futures, contango is the normal state and means the market expects future volatility to be higher.
D
Dark Pool
A private exchange where institutional investors trade large blocks of shares without displaying orders publicly. About 40% of US equity volume trades through dark pools.
Delta
The rate of change in an option's price per $1 move in the underlying asset. A delta of 0.50 means the option moves $0.50 for every $1 move in the stock. Also used as a proxy for probability of expiring in-the-money.
DIX
Dark Index, a measure of dark pool sentiment from SqueezeMetrics. Higher DIX readings suggest institutional buying; lower readings suggest selling.
G
Gamma Squeeze
A rapid price move caused by market makers hedging their short gamma positions. As price rises, dealers buy more stock to hedge, pushing price higher, a feedback loop.
GEX
Gamma Exposure, measures the total gamma risk held by options market makers. Positive GEX means dealers suppress volatility; negative GEX means they amplify it.
GEX Flip
The price level where net gamma exposure changes sign from positive to negative. Below the flip, expect amplified moves; above it, expect dampened moves.
H
Hedging-Flow Indicator
An intraday estimate of the stock or futures dealers trade to hedge the session's option trades, drawn as a cumulative line. It describes estimated hedging so far, not the next move.
I
Implied Volatility
The market consensus forecast of future price movement, derived from options prices. Higher IV means the market expects larger price swings.
IV Crush
sizing the drop before the event, and why direction alone does not save the trade, full definition
M
Market Breadth
Measures how broadly a market move is supported. Strong breadth means many stocks participating; weak breadth means few stocks driving the index.
Max Pain
The strike price at which the most options contracts would expire worthless, causing maximum loss to options holders. Markets sometimes gravitate toward max pain at expiration.
O
Open Interest
The total number of outstanding (unclosed) options contracts. Rising OI with rising price is bullish; rising OI with falling price is bearish.
Order Flow
The analysis of buy and sell orders to gauge market sentiment and predict short-term price direction. Includes tracking sweeps, blocks, dark pool prints, and aggressive orders hitting the bid or ask.
P
Put Wall
why the usual dealer-buying explanation for it is backwards, full definition
Put/Call Ratio
The ratio of put volume to call volume. Readings above 1.0 suggest bearish sentiment; below 0.7 suggest bullish sentiment. Extreme readings often mark reversal points.
S
Sector Rotation
The movement of investment capital from one sector to another based on the economic cycle. Early cycle favors cyclicals; late cycle favors defensives.
Skew
The difference in implied volatility between out-of-the-money puts and calls. Steep skew means the market is pricing in more downside risk. Also called the volatility smile or smirk.
Sweep
An options order that simultaneously hits multiple exchanges to get filled quickly. Sweeps indicate urgency and are considered aggressive institutional activity.
Swing Line
SquawkFlow's name for the lowest strike between the put wall and the call wall where modelled net dealer gamma is positive. Above it, dealer hedging is modelled to damp moves; below it, to add to them. Other sites call a similar level the "volatility trigger".
T
Term Structure
The relationship between implied volatility and expiration dates. Normal term structure shows higher IV for longer expirations. Inverted term structure signals near-term fear.
Theta
Time decay, the rate at which an option loses value each day as it approaches expiration. Theta accelerates in the final weeks before expiry, especially for at-the-money options.
V
Vanna Exposure
the two dealer-delta numbers that move when price does not, full definition
Vega
The sensitivity of an option's price to a 1% change in implied volatility. High-vega options benefit from rising IV; selling high-vega options profits from IV contraction.
VIX
The VIX measures expected 30-day volatility of the S&P 500. Often called the "fear gauge." Readings above 20 indicate elevated fear; below 15 indicates complacency.
VWAP
Volume-Weighted Average Price, the average price a security has traded at throughout the day, weighted by volume. Institutional traders use VWAP as a benchmark for execution quality.
Y
Yield Curve
A graph plotting Treasury yields across maturities. An inverted curve (short-term rates higher than long-term) has preceded every recession since the 1970s.
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