Gamma Exposure is an indicator by SqueezeMetrics which refers to the sensitivity of existing options contracts to changes in the underlying S&P 500. Low readings are bullish for the stock market, high readings are bearish for the stock market.

To account for changes in the stock market’s value over time, Relative Gamma Exposure divides Gamma Exposure by the S&P 500’s value. It then takes a 10 day moving average to smooth out day-to-day fluctuations in this indicator.

Data source:

Chart software: HighCharts