One word for how the market is set up to move.

What it is

In one line: the weather says whether the big option sellers, called dealers, are set up to calm price moves or to speed them up.

Dealers sell options to everyone else. To stay safe they trade the coin as the price moves, and how much they must trade depends on a number called gamma. Add up gamma across the options that expire soon and you get one total, net gamma. If it is positive, their trading pushes against price moves. If it is negative, their trading pushes along with them. The weather turns that into a word and adds how close the market is to the point where the total would change sign.

It describes how the book is set up right now. It does not say where the price will go.

The five words

Two things decide the word: the sign of net gamma, and how far the price is from the gamma flip, the level where the sign would change.

Green words (Clear, Fair) mean positive gamma, red words (Showers, Storm) mean negative gamma, and amber (Unsettled) means undecided. Those are all the possibilities: two signs and three distances, plus one exception. When net gamma is exactly zero, or very close to zero (under 2% of the book's total gamma), the word is Unsettled whatever the distance.

The road picture

Think of the market as a car. The gamma flip is a line across the road.

• Smooth side (Clear, Fair). Dealer hedging works like shock absorbers. A bump gets soaked up and the car steadies. Clear is far from the line; Fair is smooth road but close to it.
• Icy side (Showers, Storm). Dealer hedging works like pushing a swing. Each push adds to the movement. Showers is icy road but close to the line, so it could be smooth again soon; Storm is far out on the ice.
• On the line, or on flat road (Unsettled). Within 1% of the line, a small move could change which side the car is on. Unsettled also covers a road with almost no slope either way: when calls and puts nearly cancel, there is no side to be on.

Reading the card, sentence by sentence

The sentence under the word is built from three parts. Here is each one in plain words.

“Net gamma is negative.” Gamma is how much dealers must trade for each 1% the price moves. Net means all the options in scope added together, calls counted as positive and puts as negative. Negative means that in total they must trade with the move. Positive means against it.

“No gamma flip within 25% of the price counts, so the sign alone sets this reading.” The line on the road is the gamma flip. Knowla looks up to 25% above and below the price for a point where the running total of gamma changes sign. If it finds none, the card shows a dash and says so. With no line nearby, the whole area is on one side, so the word depends only on the sign: Clear or Storm, never Fair or Showers.

“Dealer hedging tends to lean with moves, which can amplify them.” This is the effect of the sign. Negative gamma: with the move, so moves can grow. Positive gamma: “lean against moves, which damps them”, so moves tend to shrink. “Tends” and “can” are deliberate. This is a pressure, not a rule.

“Net gamma is negative but only 1.0% of the book's total gamma, too close to zero to call.” The calls and puts almost cancel, so hedging has almost no lean either way. The sign is still shown, but it can change within minutes, so the word is Unsettled.

When a flip does count, the sentence names it instead: “Net gamma is positive and the gamma flip is 4.2% below the price.” Within 1% it says a small move can change which way hedging leans.

If the price moves

Say the price is 78,000 and a dealer is hedged at that level. Here is what their hedging does next.

A bowl keeps a ball near the middle (positive gamma). A hill sends it rolling away (negative gamma). Most of the time dealer hedging is one of several forces on the price, so this adds a push to the others; it does not replace them.

The other numbers on the card

• Price. The coin's price at the time of the reading.
• Call wall. The strike with the most call open interest in coins, over the expiries in scope. Where call positioning is thickest.
• Put wall. The strike with the most put open interest in coins, over the expiries in scope. Where put positioning is thickest.
• Gamma flip. The level where the running total of net gamma changes sign, or a dash if none counts.
• “Next 25 days · 7 expiries”. The scope: only options expiring within about a month are used, never fewer than the nearest two expiries.
• “All venues”. Deribit, OKX and Bybit added together. Derive and Paradex are separate books and are not in the sum.
• Since. A comparison of the flip and net gamma with the previous collection, about five minutes earlier.

Walls are counted by open interest. They mark where positions are concentrated, and moves sometimes stall or speed up near them. They are not forecasts.

How it is calculated

Every collection, about every five minutes, runs the same steps.

1. Pick the scope. Take every expiry within 30 days, and never fewer than the nearest two.
2. Dollar gamma for each contract. Calls count as positive and puts as negative.

   GEX = gamma × open interest (coins) × price² × 1%

3. Add up by strike. For each strike, net = call GEX minus put GEX.
4. Net gamma. The sum of every strike's net. Its sign is positive, negative, or exactly zero.
5. Gross gamma and the share. Add every call GEX and every put GEX as unsigned amounts. The share is net gamma, unsigned, divided by that gross total.
6. Find the flip. Walk the strikes from low to high keeping a running total of net. Each time the total changes sign is a crossing, placed between the two strikes by straight-line interpolation. A crossing counts only if the running total reaches at least 5% of the book's total absolute gamma on both sides of it, so a wobble at the edge of the chain is ignored. Of the crossings that count, the nearest to the price is the flip, if it is within 25% of the price.
7. Measure the distance. (flip − price) ÷ price, as a percent.
8. Choose the word. Zero net, a share under 2%, or under 1% from the flip: Unsettled. Otherwise positive net gives Fair (1% to 3%) or Clear (3% or more, or no flip), and negative net gives Showers or Storm in the same way.
9. Write the sentence. It states the sign, the flip and its distance, and the effect, and never says what to do.

The full formulas and every setting are on the methodology page. One thing to know: the sign is a convention. Nobody publishes who holds which option, so Knowla counts calls as positive and puts as negative to draw the shape of the book. It is not a record of who is long or short.

Why it can change in minutes

Net gamma is the small difference between two big numbers. On 2 November 2026 the near-term BTC book held about 150 million dollars of call gamma and 150 million of put gamma. The net was about −3 million, roughly 1% of the total. A change of 1% or 2% in either side is enough to move the net by several million, and to flip its sign.

Expiries cause larger steps. At 08:00 UTC that day an expiry removed the near-dated options that held most of the positive gamma, and the net fell from about +183 million to about −8 million in five minutes. After that it hovered around zero and changed sign several times an hour as the price moved a few tenths of a percent.

That is why a net this close to zero is called Unsettled instead of Clear or Storm.

Why 1%, 2%, 3%, 5% and 25%

These five numbers are our choices. They are not market constants and no published standard sets them, so here is what each one does.

The 25% does not change the word. Any flip 3% or more away gives the same word as no flip at all, so any limit above 3% gives identical words. The limit only decides whether a far-away flip is displayed and named in the sentence.

We checked it on stored readings, 440 collections of BTC from 15 to 22 October 2026. A counted flip existed in 289 of them, and the nearest was between 0.1% and 15.7% from the price, with a median of 9.2%. Changing the limit from 5% to 100% changed the word in none of the 440. Over that week, before the near-zero band below was added, the word was Clear 342 times, Storm 79, Fair 15, Unsettled 4 and Showers never, and it changed about five times a day. One week of one market regime is a small sample, so treat the distribution as a guide only.

We kept 25%: it is wider than any flip seen in that week, so it hides nothing real, and it stops a distant, meaningless crossing from being named as the line.

The 2% does change the word. We set it from the size of the wobble: across those 440 collections the typical five-minute swing in net gamma was about 1% of the book's total gamma at the median and 1.9% at the 75th percentile. With no band, 27 readings jumped straight from a green word to a red one. With a 1% band, 8 did. With 2%, none did. It left 21% of the readings Unsettled. A hard cut-off has a cost: the word still changes, now between Clear or Storm and Unsettled, so the count of changes did not fall. What disappeared is the jump from green to red.

What it cannot tell you

• Where the price will go. The weather describes a pressure, and other forces are often larger.
• Who is long or short. The sign is a convention for drawing the book.
• Anything beyond the nearest month of expiries, or beyond the venues Knowla reads.
• Stability. Even with the near-zero band, a book near the edge of it can change word within minutes, so a screenshot is only true for the time on it.

Everything here is education, not financial advice.