You’ve learned how GEX works. You know the difference between positive and negative gamma regimes. But there’s one more piece of the puzzle: predicting when the regime is about to change.
A gamma unwind event is what happens when a large, concentrated position in options expires or is unwound, and the dealer hedging flows associated with those options suddenly disappear. The support or resistance that was being created by dealer hedging vanishes, and price can move violently in either direction as the market adjusts to the new reality.
GUPS — the Gamma Unwind Probability Score — is AlphaTrak’s proprietary metric that measures the probability of a gamma unwind event occurring. It synthesizes six risk factors into a single number from 0 to 100. When GUPS is high, the conditions for a violent unwind are in place. When GUPS is low, the gamma environment is stable.
The Six Risk Factors
GUPS is built from six inputs, each measuring a different dimension of gamma risk. Understanding the inputs helps you understand why the score is elevated or depressed:
| Factor | What It Measures | Why It Matters |
|---|---|---|
| 1. GEX Concentration | How much of total gamma is concentrated at a few strikes vs. spread across many. | Concentrated gamma = fragile. If price moves away from a single high-gamma strike, the stabilizing effect disappears all at once. Distributed gamma is more resilient. |
| 2. Days to OPEX | How close the nearest options expiration is. | Gamma intensifies near expiration. 0-2 DTE gamma is 5-10x more powerful than 30 DTE gamma. Approaching OPEX = higher unwind risk. |
| 3. GEX Flip Proximity | How close current price is to the GEX Flip level. | Near the flip = the market is on the edge between regimes. A small move could shift from positive to negative gamma, triggering a regime change. |
| 4. Put Skew | How much more expensive downside puts are vs. upside calls. | Steep put skew means the market is hedging aggressively against downside. When that hedging unwinds (puts expire or are sold), the support disappears. |
| 5. IV Rank | Current implied volatility relative to the past year (0-100 scale). | High IV rank means options are expensive, which means a lot of premium is outstanding. When premium is high, the potential energy for an unwind is greater. |
| 6. Open Interest Change | Rate of change in total open interest over the past 5 sessions. | Rapidly increasing OI = new positions being built (more gamma to unwind later). Rapidly decreasing OI = positions being closed (unwind may already be happening). |
Reading the GUPS Score
| GUPS Range | Risk Level | Action |
|---|---|---|
| 0-25 | Low | Gamma environment is stable. Normal trading. Use your standard playbook. This is when your setups have the highest success rates. |
| 25-50 | Elevated | Some risk factors are present. Monitor daily. Consider reducing position size by 20% and tightening your awareness of the GEX Flip level. |
| 50-75 | High | Multiple risk factors are converging. Reduce exposure by 40-50%. Widen stops. Move to the negative-GEX playbook preemptively. Avoid new swing entries. |
| 75-100 | Extreme | All conditions for a major unwind are in place. Maximum caution. Cash is king. If you must trade, day trades only, small size. This is where 3-5% single-day moves happen. |
Worked Example: GUPS Rising Into OPEX
GUPS and the Full Framework
GUPS sits at the top of the AlphaTrak methodology as the risk governor. Everything else — moving averages, support/resistance, the Tier System, confirmation, GEX regime — tells you what to trade and how to trade it. GUPS tells you how much risk to take on.
1. GUPS Score → How much risk to take (exposure governor)
2. GEX Regime → Which playbook to use (positive vs negative)
3. Moving Averages → Trend direction and mode (Portfolio vs Tactical)
4. Support/Resistance → Where to enter and exit
5. Confirmation → Volume, close, follow-through
6. Tier System → Position sizing and scaling
When GUPS is low (0-25), you run the full framework with confidence. Your setups work, your levels hold, and your risk is well-managed. When GUPS is high (50+), you scale back everything. Fewer positions, smaller sizes, wider stops, shorter holding periods. The framework still works, but you’re running it at half throttle because the environment is unstable.
Common GUPS Patterns
OPEX Week Spike
GUPS typically rises 15-25 points during OPEX week as gamma concentration increases and DTE shrinks. This is the most common pattern. Expect it every month and plan accordingly: reduce exposure Tuesday-Wednesday, sit out or minimize Thursday-Friday.
Earnings Cluster + OPEX
When major earnings (AAPL, MSFT, AMZN, NVDA) coincide with OPEX week, GUPS can spike to 70+. The combination of earnings volatility and gamma expiration is the highest-risk scenario in the options calendar. Maximum caution.
Post-Unwind Opportunity
After a gamma unwind, GUPS drops sharply as the expired options clear the system. This is often the best time to establish new positions. The market is repriced, volatility has been released, and a new gamma structure forms. GUPS below 20 after a spike = fresh start.
Extended Low GUPS
Periods of sustained low GUPS (below 20 for 2+ weeks) are the golden environment. Gamma is distributed, OPEX is distant, and volatility is compressed. This is when trend-following and the 8/21 reclaim setup have their highest success rates. Press your edge here.
Using GUPS in Practice
- Check GUPS every morning as part of your pre-market routine. It takes 5 seconds. AlphaTrak shows it on the daily brief alongside GEX regime, moving average status, and key levels. If GUPS is under 30, proceed normally. If it’s over 50, adjust.
- Flag OPEX weeks on your calendar. Every month, the third Friday is monthly OPEX. Every Friday is weekly OPEX. Mark them. Plan to be lighter into these dates.
- Use GUPS to size, not to pick direction. GUPS doesn’t tell you if the market will go up or down. It tells you how much risk is in the system. High GUPS = smaller bets. Low GUPS = normal bets. That’s it.
- Combine GUPS with the environment check. GUPS at 65 + SPY below the 8/21 = maximum defensive posture. GUPS at 15 + SPY above all EMAs = maximum offensive posture. The combination of gamma risk and trend status gives you the complete picture.
GUPS is the final piece of the AlphaTrak edge. Most retail traders have never heard of gamma unwind events. They don’t know they exist until one hits them. Now you know what they are, how to see them coming, and what to do about it.
Check the score. Adjust the risk. Trade accordingly.