(Bloomberg) -- Nvidia Corp.’s correction has volumes in shares and options turning upside down.

The high options activity was often cited as one of the main reasons for the chipmaker’s relentless climb: Market makers in the contracts had to constantly hedge their positions by trading the stock as it moved higher in what is called a gamma squeeze.  

That pressure may be easing now that the shares are tanking. The number of bullish Nvidia contracts outstanding dropped by a quarter since Friday’s expiration, and call volume on Monday was half of the 20-day average, data compiled by Bloomberg show. 

Trading activity was already showing a lack of conviction in the latest leg of the rally. While Nvidia took only about a month to boost its market value to $3 trillion from $2 trillion, cash trading was down. By June 18, when the stock hit its peak, volume had fallen by about two-thirds from a high on May 23.

Nvidia shares have soared this year amid unrelenting demand for its chips that dominate the market for artificial-intelligence computing. In the latest leg of the advance, the stock surged 43% from its May 22 earnings report and stock-split announcement to its record high, when its market value of $3.34 trillion topped Microsoft Corp.’s. While it’s since posted its biggest three-day drop since 2022, it’s still up almost 140% this year. 

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