diff --git a/config/configuration.yaml b/config/configuration.yaml
index 4e0dff5..4495953 100644
--- a/config/configuration.yaml
+++ b/config/configuration.yaml
@@ -49,6 +49,8 @@ logger:
     custom_components.tibber_prices.coordinator.period_handlers.period_overlap.details: info
     # Outlier flex capping
     custom_components.tibber_prices.coordinator.period_handlers.core.details: info
+    # Level filtering details (min_distance scaling)
+    custom_components.tibber_prices.coordinator.period_handlers.level_filtering.details: info
 
     # Interval pool details (cache operations, GC):
     # Cache lookup/miss, gap detection, fetch group additions
diff --git a/custom_components/tibber_prices/config_flow.py b/custom_components/tibber_prices/config_flow.py
index f5b4654..1ef6a66 100644
--- a/custom_components/tibber_prices/config_flow.py
+++ b/custom_components/tibber_prices/config_flow.py
@@ -14,6 +14,7 @@ from .config_flow_handlers.schemas import (
     get_best_price_schema,
     get_options_init_schema,
     get_peak_price_schema,
+    get_price_level_schema,
     get_price_rating_schema,
     get_price_trend_schema,
     get_reauth_confirm_schema,
@@ -41,6 +42,7 @@ __all__ = [
     "get_best_price_schema",
     "get_options_init_schema",
     "get_peak_price_schema",
+    "get_price_level_schema",
     "get_price_rating_schema",
     "get_price_trend_schema",
     "get_reauth_confirm_schema",
diff --git a/custom_components/tibber_prices/config_flow_handlers/__init__.py b/custom_components/tibber_prices/config_flow_handlers/__init__.py
index 72837a3..45ef991 100644
--- a/custom_components/tibber_prices/config_flow_handlers/__init__.py
+++ b/custom_components/tibber_prices/config_flow_handlers/__init__.py
@@ -27,6 +27,7 @@ from custom_components.tibber_prices.config_flow_handlers.schemas import (
     get_best_price_schema,
     get_options_init_schema,
     get_peak_price_schema,
+    get_price_level_schema,
     get_price_rating_schema,
     get_price_trend_schema,
     get_reauth_confirm_schema,
@@ -56,6 +57,7 @@ __all__ = [
     "get_best_price_schema",
     "get_options_init_schema",
     "get_peak_price_schema",
+    "get_price_level_schema",
     "get_price_rating_schema",
     "get_price_trend_schema",
     "get_reauth_confirm_schema",
diff --git a/custom_components/tibber_prices/config_flow_handlers/options_flow.py b/custom_components/tibber_prices/config_flow_handlers/options_flow.py
index 5ea073a..c1ef500 100644
--- a/custom_components/tibber_prices/config_flow_handlers/options_flow.py
+++ b/custom_components/tibber_prices/config_flow_handlers/options_flow.py
@@ -15,6 +15,7 @@ from custom_components.tibber_prices.config_flow_handlers.schemas import (
     get_display_settings_schema,
     get_options_init_schema,
     get_peak_price_schema,
+    get_price_level_schema,
     get_price_rating_schema,
     get_price_trend_schema,
     get_reset_to_defaults_schema,
@@ -191,6 +192,7 @@ class TibberPricesOptionsFlowHandler(OptionsFlow):
                 "general_settings",
                 "display_settings",
                 "current_interval_price_rating",
+                "price_level",
                 "volatility",
                 "best_price",
                 "peak_price",
@@ -329,6 +331,25 @@ class TibberPricesOptionsFlowHandler(OptionsFlow):
             errors=errors,
         )
 
+    async def async_step_price_level(self, user_input: dict[str, Any] | None = None) -> ConfigFlowResult:
+        """Configure Tibber price level gap tolerance (smoothing for API 'level' field)."""
+        errors: dict[str, str] = {}
+
+        if user_input is not None:
+            # No validation needed - slider constraints ensure valid range
+            # Store flat data directly in options
+            self._options.update(user_input)
+            # async_create_entry automatically handles change detection and listener triggering
+            self._save_options_if_changed()
+            # Return to menu for more changes
+            return await self.async_step_init()
+
+        return self.async_show_form(
+            step_id="price_level",
+            data_schema=get_price_level_schema(self.config_entry.options),
+            errors=errors,
+        )
+
     async def async_step_best_price(self, user_input: dict[str, Any] | None = None) -> ConfigFlowResult:
         """Configure best price period settings."""
         errors: dict[str, str] = {}
diff --git a/custom_components/tibber_prices/config_flow_handlers/schemas.py b/custom_components/tibber_prices/config_flow_handlers/schemas.py
index 1df45d3..0adfd3d 100644
--- a/custom_components/tibber_prices/config_flow_handlers/schemas.py
+++ b/custom_components/tibber_prices/config_flow_handlers/schemas.py
@@ -28,6 +28,7 @@ from custom_components.tibber_prices.const import (
     CONF_PEAK_PRICE_MIN_DISTANCE_FROM_AVG,
     CONF_PEAK_PRICE_MIN_LEVEL,
     CONF_PEAK_PRICE_MIN_PERIOD_LENGTH,
+    CONF_PRICE_LEVEL_GAP_TOLERANCE,
     CONF_PRICE_RATING_GAP_TOLERANCE,
     CONF_PRICE_RATING_HYSTERESIS,
     CONF_PRICE_RATING_THRESHOLD_HIGH,
@@ -58,6 +59,7 @@ from custom_components.tibber_prices.const import (
     DEFAULT_PEAK_PRICE_MIN_DISTANCE_FROM_AVG,
     DEFAULT_PEAK_PRICE_MIN_LEVEL,
     DEFAULT_PEAK_PRICE_MIN_PERIOD_LENGTH,
+    DEFAULT_PRICE_LEVEL_GAP_TOLERANCE,
     DEFAULT_PRICE_RATING_GAP_TOLERANCE,
     DEFAULT_PRICE_RATING_HYSTERESIS,
     DEFAULT_PRICE_RATING_THRESHOLD_HIGH,
@@ -77,6 +79,7 @@ from custom_components.tibber_prices.const import (
     MAX_GAP_COUNT,
     MAX_MIN_PERIOD_LENGTH,
     MAX_MIN_PERIODS,
+    MAX_PRICE_LEVEL_GAP_TOLERANCE,
     MAX_PRICE_RATING_GAP_TOLERANCE,
     MAX_PRICE_RATING_HYSTERESIS,
     MAX_PRICE_RATING_THRESHOLD_HIGH,
@@ -89,6 +92,7 @@ from custom_components.tibber_prices.const import (
     MAX_VOLATILITY_THRESHOLD_VERY_HIGH,
     MIN_GAP_COUNT,
     MIN_PERIOD_LENGTH,
+    MIN_PRICE_LEVEL_GAP_TOLERANCE,
     MIN_PRICE_RATING_GAP_TOLERANCE,
     MIN_PRICE_RATING_HYSTERESIS,
     MIN_PRICE_RATING_THRESHOLD_HIGH,
@@ -339,6 +343,30 @@ def get_price_rating_schema(options: Mapping[str, Any]) -> vol.Schema:
     )
 
 
+def get_price_level_schema(options: Mapping[str, Any]) -> vol.Schema:
+    """Return schema for Tibber price level stabilization (gap tolerance for API level field)."""
+    return vol.Schema(
+        {
+            vol.Optional(
+                CONF_PRICE_LEVEL_GAP_TOLERANCE,
+                default=int(
+                    options.get(
+                        CONF_PRICE_LEVEL_GAP_TOLERANCE,
+                        DEFAULT_PRICE_LEVEL_GAP_TOLERANCE,
+                    )
+                ),
+            ): NumberSelector(
+                NumberSelectorConfig(
+                    min=MIN_PRICE_LEVEL_GAP_TOLERANCE,
+                    max=MAX_PRICE_LEVEL_GAP_TOLERANCE,
+                    step=1,
+                    mode=NumberSelectorMode.SLIDER,
+                ),
+            ),
+        }
+    )
+
+
 def get_volatility_schema(options: Mapping[str, Any]) -> vol.Schema:
     """Return schema for volatility thresholds configuration."""
     return vol.Schema(
diff --git a/custom_components/tibber_prices/const.py b/custom_components/tibber_prices/const.py
index 0326d54..ea61b66 100644
--- a/custom_components/tibber_prices/const.py
+++ b/custom_components/tibber_prices/const.py
@@ -46,6 +46,7 @@ CONF_PRICE_RATING_THRESHOLD_LOW = "price_rating_threshold_low"
 CONF_PRICE_RATING_THRESHOLD_HIGH = "price_rating_threshold_high"
 CONF_PRICE_RATING_HYSTERESIS = "price_rating_hysteresis"
 CONF_PRICE_RATING_GAP_TOLERANCE = "price_rating_gap_tolerance"
+CONF_PRICE_LEVEL_GAP_TOLERANCE = "price_level_gap_tolerance"
 CONF_AVERAGE_SENSOR_DISPLAY = "average_sensor_display"  # "median" or "mean"
 CONF_PRICE_TREND_THRESHOLD_RISING = "price_trend_threshold_rising"
 CONF_PRICE_TREND_THRESHOLD_FALLING = "price_trend_threshold_falling"
@@ -96,6 +97,7 @@ DEFAULT_PRICE_RATING_THRESHOLD_LOW = -10  # Default rating threshold low percent
 DEFAULT_PRICE_RATING_THRESHOLD_HIGH = 10  # Default rating threshold high percentage
 DEFAULT_PRICE_RATING_HYSTERESIS = 2.0  # Hysteresis percentage to prevent flickering at threshold boundaries
 DEFAULT_PRICE_RATING_GAP_TOLERANCE = 1  # Max consecutive intervals to smooth out (0 = disabled)
+DEFAULT_PRICE_LEVEL_GAP_TOLERANCE = 1  # Max consecutive intervals to smooth out for price level (0 = disabled)
 DEFAULT_AVERAGE_SENSOR_DISPLAY = "median"  # Default: show median in state, mean in attributes
 DEFAULT_PRICE_TREND_THRESHOLD_RISING = 3  # Default trend threshold for rising prices (%)
 DEFAULT_PRICE_TREND_THRESHOLD_FALLING = -3  # Default trend threshold for falling prices (%, negative value)
@@ -139,6 +141,8 @@ MIN_PRICE_RATING_HYSTERESIS = 0.0  # Minimum hysteresis (0 = disabled)
 MAX_PRICE_RATING_HYSTERESIS = 5.0  # Maximum hysteresis (5% band)
 MIN_PRICE_RATING_GAP_TOLERANCE = 0  # Minimum gap tolerance (0 = disabled)
 MAX_PRICE_RATING_GAP_TOLERANCE = 4  # Maximum gap tolerance (4 intervals = 1 hour)
+MIN_PRICE_LEVEL_GAP_TOLERANCE = 0  # Minimum gap tolerance for price level (0 = disabled)
+MAX_PRICE_LEVEL_GAP_TOLERANCE = 4  # Maximum gap tolerance for price level (4 intervals = 1 hour)
 
 # Volatility threshold limits
 # MODERATE threshold: practical range 5% to 25% (entry point for noticeable fluctuation)
@@ -339,6 +343,7 @@ def get_default_options(currency_code: str | None) -> dict[str, Any]:
         CONF_PRICE_RATING_THRESHOLD_HIGH: DEFAULT_PRICE_RATING_THRESHOLD_HIGH,
         CONF_PRICE_RATING_HYSTERESIS: DEFAULT_PRICE_RATING_HYSTERESIS,
         CONF_PRICE_RATING_GAP_TOLERANCE: DEFAULT_PRICE_RATING_GAP_TOLERANCE,
+        CONF_PRICE_LEVEL_GAP_TOLERANCE: DEFAULT_PRICE_LEVEL_GAP_TOLERANCE,
         # Volatility thresholds (flat - single-section step)
         CONF_VOLATILITY_THRESHOLD_MODERATE: DEFAULT_VOLATILITY_THRESHOLD_MODERATE,
         CONF_VOLATILITY_THRESHOLD_HIGH: DEFAULT_VOLATILITY_THRESHOLD_HIGH,
diff --git a/custom_components/tibber_prices/coordinator/core.py b/custom_components/tibber_prices/coordinator/core.py
index 7be448c..168e884 100644
--- a/custom_components/tibber_prices/coordinator/core.py
+++ b/custom_components/tibber_prices/coordinator/core.py
@@ -264,7 +264,7 @@ class TibberPricesDataUpdateCoordinator(DataUpdateCoordinator[dict[str, Any]]):
 
     async def _handle_options_update(self, _hass: HomeAssistant, _config_entry: ConfigEntry) -> None:
         """Handle options update by invalidating config caches and re-transforming data."""
-        self._log("debug", "Options updated, invalidating config caches")
+        self._log("debug", "Options update triggered, re-transforming data")
         self._data_transformer.invalidate_config_cache()
         self._period_calculator.invalidate_config_cache()
 
@@ -272,12 +272,10 @@ class TibberPricesDataUpdateCoordinator(DataUpdateCoordinator[dict[str, Any]]):
         # This updates rating_levels, volatility, and period calculations
         # without needing to fetch new data from the API
         if self._cached_price_data:
-            self._log("debug", "Re-transforming cached data with new configuration")
             self.data = self._transform_data(self._cached_price_data)
-            # Notify all listeners about the updated data
             self.async_update_listeners()
         else:
-            self._log("warning", "No cached data available to re-transform")
+            self._log("debug", "No cached data to re-transform")
 
     @callback
     def async_add_time_sensitive_listener(self, update_callback: TimeServiceCallback) -> CALLBACK_TYPE:
diff --git a/custom_components/tibber_prices/coordinator/data_transformation.py b/custom_components/tibber_prices/coordinator/data_transformation.py
index 6aa1852..2c62347 100644
--- a/custom_components/tibber_prices/coordinator/data_transformation.py
+++ b/custom_components/tibber_prices/coordinator/data_transformation.py
@@ -2,6 +2,7 @@
 
 from __future__ import annotations
 
+import copy
 import logging
 from typing import TYPE_CHECKING, Any
 
@@ -49,7 +50,12 @@ class TibberPricesDataTransformer:
         getattr(_LOGGER, level)(prefixed_message, *args, **kwargs)
 
     def get_threshold_percentages(self) -> dict[str, int | float]:
-        """Get threshold percentages, hysteresis and gap tolerance from config options."""
+        """
+        Get threshold percentages, hysteresis and gap tolerance for RATING_LEVEL from config options.
+
+        CRITICAL: This function is ONLY for rating_level (internal calculation: LOW/NORMAL/HIGH).
+        Do NOT use for price level (Tibber API: VERY_CHEAP/CHEAP/NORMAL/EXPENSIVE/VERY_EXPENSIVE).
+        """
         options = self.config_entry.options or {}
         return {
             "low": options.get(_const.CONF_PRICE_RATING_THRESHOLD_LOW, _const.DEFAULT_PRICE_RATING_THRESHOLD_LOW),
@@ -60,11 +66,33 @@ class TibberPricesDataTransformer:
             ),
         }
 
+    def get_level_gap_tolerance(self) -> int:
+        """
+        Get gap tolerance for PRICE LEVEL (Tibber API) from config options.
+
+        CRITICAL: This is separate from rating_level gap tolerance.
+        Price level comes from Tibber API (VERY_CHEAP/CHEAP/NORMAL/EXPENSIVE/VERY_EXPENSIVE).
+        Rating level is calculated internally (LOW/NORMAL/HIGH).
+        """
+        options = self.config_entry.options or {}
+        return options.get(_const.CONF_PRICE_LEVEL_GAP_TOLERANCE, _const.DEFAULT_PRICE_LEVEL_GAP_TOLERANCE)
+
     def invalidate_config_cache(self) -> None:
-        """Invalidate config cache when options change."""
+        """
+        Invalidate config cache AND transformation cache when options change.
+
+        CRITICAL: When options like gap_tolerance, hysteresis, or price_level_gap_tolerance
+        change, we must clear BOTH caches:
+        1. Config cache (_config_cache) - forces config rebuild on next check
+        2. Transformation cache (_cached_transformed_data) - forces data re-enrichment
+
+        This ensures that the next call to transform_data() will re-calculate
+        rating_levels and apply new gap tolerance settings to existing price data.
+        """
         self._config_cache_valid = False
         self._config_cache = None
-        self._log("debug", "Config cache invalidated")
+        self._cached_transformed_data = None  # Force re-transformation with new config
+        self._last_transformation_config = None  # Force config comparison to trigger
 
     def _get_current_transformation_config(self) -> dict[str, Any]:
         """
@@ -89,6 +117,7 @@ class TibberPricesDataTransformer:
 
         config = {
             "thresholds": self.get_threshold_percentages(),
+            "level_gap_tolerance": self.get_level_gap_tolerance(),  # Separate: Tibber's price level smoothing
             # Volatility thresholds now flat (single-section step)
             "volatility_thresholds": {
                 "moderate": options.get(_const.CONF_VOLATILITY_THRESHOLD_MODERATE, 15.0),
@@ -155,8 +184,9 @@ class TibberPricesDataTransformer:
 
         # Configuration changed - must retransform
         current_config = self._get_current_transformation_config()
-        if current_config != self._last_transformation_config:
-            self._log("debug", "Configuration changed, retransforming data")
+        config_changed = current_config != self._last_transformation_config
+
+        if config_changed:
             return True
 
         # Check for midnight turnover
@@ -181,10 +211,17 @@ class TibberPricesDataTransformer:
         source_data_timestamp = raw_data.get("timestamp")
 
         # Return cached transformed data if no retransformation needed
-        if (
-            not self._should_retransform_data(current_time, source_data_timestamp)
-            and self._cached_transformed_data is not None
-        ):
+        should_retransform = self._should_retransform_data(current_time, source_data_timestamp)
+        has_cache = self._cached_transformed_data is not None
+
+        self._log(
+            "info",
+            "transform_data: should_retransform=%s, has_cache=%s",
+            should_retransform,
+            has_cache,
+        )
+
+        if not should_retransform and has_cache:
             self._log("debug", "Using cached transformed data (no transformation needed)")
             return self._cached_transformed_data
 
@@ -192,7 +229,10 @@ class TibberPricesDataTransformer:
 
         # Extract data from single-home structure
         home_id = raw_data.get("home_id", "")
-        all_intervals = raw_data.get("price_info", [])
+        # CRITICAL: Make a deep copy of intervals to avoid modifying cached raw data
+        # The enrichment function modifies intervals in-place, which would corrupt
+        # the original API data and make re-enrichment with different settings impossible
+        all_intervals = copy.deepcopy(raw_data.get("price_info", []))
         currency = raw_data.get("currency", "EUR")
 
         if not all_intervals:
@@ -209,13 +249,16 @@ class TibberPricesDataTransformer:
 
         # Enrich price info dynamically with calculated differences and rating levels
         # (Modifies all_intervals in-place, returns same list)
-        thresholds = self.get_threshold_percentages()
+        thresholds = self.get_threshold_percentages()  # Only for rating_level
+        level_gap_tolerance = self.get_level_gap_tolerance()  # Separate: for Tibber's price level
+
         enriched_intervals = enrich_price_info_with_differences(
             all_intervals,
             threshold_low=thresholds["low"],
             threshold_high=thresholds["high"],
             hysteresis=float(thresholds["hysteresis"]),
             gap_tolerance=int(thresholds["gap_tolerance"]),
+            level_gap_tolerance=level_gap_tolerance,
             time=self.time,
         )
 
diff --git a/custom_components/tibber_prices/coordinator/period_handlers/level_filtering.py b/custom_components/tibber_prices/coordinator/period_handlers/level_filtering.py
index d26f3e8..bcd783b 100644
--- a/custom_components/tibber_prices/coordinator/period_handlers/level_filtering.py
+++ b/custom_components/tibber_prices/coordinator/period_handlers/level_filtering.py
@@ -181,7 +181,7 @@ def check_interval_criteria(
         if scale_factor < SCALE_FACTOR_WARNING_THRESHOLD:
             import logging  # noqa: PLC0415
 
-            _LOGGER = logging.getLogger(__name__)  # noqa: N806
+            _LOGGER = logging.getLogger(f"{__name__}.details")  # noqa: N806
             _LOGGER.debug(
                 "High flex %.1f%% detected: Reducing min_distance %.1f%% → %.1f%% (scale %.2f)",
                 flex_abs * 100,
diff --git a/custom_components/tibber_prices/coordinator/period_handlers/period_overlap.py b/custom_components/tibber_prices/coordinator/period_handlers/period_overlap.py
index 7457c3b..079f62a 100644
--- a/custom_components/tibber_prices/coordinator/period_handlers/period_overlap.py
+++ b/custom_components/tibber_prices/coordinator/period_handlers/period_overlap.py
@@ -105,7 +105,7 @@ def merge_adjacent_periods(period1: dict, period2: dict) -> dict:
         "period2_end": period2["end"].isoformat(),
     }
 
-    _LOGGER.debug(
+    _LOGGER_DETAILS.debug(
         "%sMerged periods: %s-%s + %s-%s → %s-%s (duration: %d min)",
         INDENT_L2,
         period1["start"].strftime("%H:%M"),
@@ -145,7 +145,7 @@ def resolve_period_overlaps(
         - new_periods_count: Number of new periods added (some may have been merged)
 
     """
-    _LOGGER.debug(
+    _LOGGER_DETAILS.debug(
         "%sresolve_period_overlaps called: existing=%d, new=%d",
         INDENT_L0,
         len(existing_periods),
@@ -175,7 +175,7 @@ def resolve_period_overlaps(
                 and abs((relaxed_end - existing["end"]).total_seconds()) < tolerance_seconds
             ):
                 is_duplicate = True
-                _LOGGER.debug(
+                _LOGGER_DETAILS.debug(
                     "%sSkipping duplicate period %s-%s (already exists)",
                     INDENT_L1,
                     relaxed_start.strftime("%H:%M"),
@@ -198,7 +198,7 @@ def resolve_period_overlaps(
 
             if is_adjacent or is_overlapping:
                 periods_to_merge.append((idx, existing))
-                _LOGGER.debug(
+                _LOGGER_DETAILS.debug(
                     "%sPeriod %s-%s %s with existing period %s-%s",
                     INDENT_L1,
                     relaxed_start.strftime("%H:%M"),
@@ -212,7 +212,7 @@ def resolve_period_overlaps(
             # No merge needed - add as new period
             merged.append(relaxed)
             periods_added += 1
-            _LOGGER.debug(
+            _LOGGER_DETAILS.debug(
                 "%sAdded new period %s-%s (no overlap/adjacency)",
                 INDENT_L1,
                 relaxed_start.strftime("%H:%M"),
diff --git a/custom_components/tibber_prices/translations/de.json b/custom_components/tibber_prices/translations/de.json
index 352df74..d79bbd6 100644
--- a/custom_components/tibber_prices/translations/de.json
+++ b/custom_components/tibber_prices/translations/de.json
@@ -136,6 +136,7 @@
                     "general_settings": "⚙️ Allgemeine Einstellungen",
                     "display_settings": "💱 Währungsanzeige",
                     "current_interval_price_rating": "📊 Preisbewertung",
+                    "price_level": "🏷️ Preisniveau",
                     "volatility": "💨 Preis-Volatilität",
                     "best_price": "💚 Bestpreis",
                     "peak_price": "🔴 Spitzenpreis",
@@ -320,6 +321,17 @@
                     "confirm_reset": "Ja, alles auf Werkseinstellungen zurücksetzen"
                 },
                 "submit": "Jetzt zurücksetzen"
+            },
+            "price_level": {
+                "title": "🏷️ Preisniveau-Einstellungen (von Tibber API)",
+                "description": "**Konfiguriere die Stabilisierung für Tibbers Preisniveau-Klassifizierung (sehr günstig/günstig/normal/teuer/sehr teuer).**\n\nTibbers API liefert ein Preisniveau-Feld für jedes Intervall. Diese Einstellung glättet kurze Schwankungen, um Instabilität in Automatisierungen zu verhindern.",
+                "data": {
+                    "price_level_gap_tolerance": "Gap-Toleranz"
+                },
+                "data_description": {
+                    "price_level_gap_tolerance": "Maximale Anzahl aufeinanderfolgender Intervalle, die 'geglättet' werden können, wenn sie von umgebenden Preisniveaus abweichen. Kleine isolierte Niveauänderungen werden mit dem dominanten Nachbarblock zusammengeführt. Beispiel: 1 bedeutet, dass ein einzelnes 'normal'-Intervall, umgeben von 'günstig'-Intervallen, zu 'günstig' korrigiert wird. Auf 0 setzen zum Deaktivieren. Standard: 1"
+                },
+                "submit": "↩ Speichern & Zurück"
             }
         },
         "error": {
diff --git a/custom_components/tibber_prices/translations/en.json b/custom_components/tibber_prices/translations/en.json
index 8d2726d..f2c3ad8 100644
--- a/custom_components/tibber_prices/translations/en.json
+++ b/custom_components/tibber_prices/translations/en.json
@@ -136,6 +136,7 @@
                     "general_settings": "⚙️ General Settings",
                     "display_settings": "💱 Currency Display",
                     "current_interval_price_rating": "📊 Price Rating",
+                    "price_level": "🏷️ Price Level",
                     "volatility": "💨 Price Volatility",
                     "best_price": "💚 Best Price Period",
                     "peak_price": "🔴 Peak Price Period",
@@ -186,6 +187,17 @@
                 },
                 "submit": "↩ Save & Back"
             },
+            "price_level": {
+                "title": "🏷️ Price Level Settings",
+                "description": "**Configure stabilization for Tibber's price level classification (very cheap/cheap/normal/expensive/very expensive).**\n\nTibber's API provides a price level field for each interval. This setting smooths out brief fluctuations to prevent automation instability.",
+                "data": {
+                    "price_level_gap_tolerance": "Gap Tolerance"
+                },
+                "data_description": {
+                    "price_level_gap_tolerance": "Maximum number of consecutive intervals that can be 'smoothed out' if they differ from surrounding price levels. Small isolated level changes are merged into the dominant neighboring block. Example: 1 means a single 'normal' interval surrounded by 'cheap' intervals gets corrected to 'cheap'. Set to 0 to disable. Default: 1"
+                },
+                "submit": "↩ Save & Back"
+            },
             "best_price": {
                 "title": "💚 Best Price Period Settings",
                 "description": "**Configure settings for the Best Price Period binary sensor. This sensor is active during periods with the lowest electricity prices.**\n\n---",
diff --git a/custom_components/tibber_prices/translations/nb.json b/custom_components/tibber_prices/translations/nb.json
index 6e8755c..363ec4e 100644
--- a/custom_components/tibber_prices/translations/nb.json
+++ b/custom_components/tibber_prices/translations/nb.json
@@ -136,6 +136,7 @@
                     "general_settings": "⚙️ Generelle innstillinger",
                     "display_settings": "💱 Valutavisning",
                     "current_interval_price_rating": "📊 Prisvurdering",
+                    "price_level": "🏷️ Prisnivå",
                     "volatility": "💨 Prisvolatilitet",
                     "best_price": "💚 Beste prisperiode",
                     "peak_price": "🔴 Toppprisperiode",
@@ -320,6 +321,17 @@
                     "confirm_reset": "Ja, tilbakestill alt til standard"
                 },
                 "submit": "Tilbakestill nå"
+            },
+            "price_level": {
+                "title": "🏷️ Prisnivå-innstillinger",
+                "description": "**Konfigurer stabilisering for Tibbers prisnivå-klassifisering (veldig billig/billig/normal/dyr/veldig dyr).**\n\nTibbers API gir et prisnivå-felt for hvert intervall. Denne innstillingen jevner ut korte svingninger for å forhindre ustabilitet i automatiseringer.",
+                "data": {
+                    "price_level_gap_tolerance": "Gap-toleranse"
+                },
+                "data_description": {
+                    "price_level_gap_tolerance": "Maksimalt antall påfølgende intervaller som kan 'jevnes ut' hvis de avviker fra omkringliggende prisnivåer. Små isolerte nivåendringer slås sammen med den dominerende nabogruppen. Eksempel: 1 betyr at et enkelt 'normal'-intervall omgitt av 'billig'-intervaller korrigeres til 'billig'. Sett til 0 for å deaktivere. Standard: 1"
+                },
+                "submit": "↩ Lagre & tilbake"
             }
         },
         "error": {
diff --git a/custom_components/tibber_prices/translations/nl.json b/custom_components/tibber_prices/translations/nl.json
index f0257f1..226b9f3 100644
--- a/custom_components/tibber_prices/translations/nl.json
+++ b/custom_components/tibber_prices/translations/nl.json
@@ -136,6 +136,7 @@
                     "general_settings": "⚙️ Algemene Instellingen",
                     "display_settings": "💱 Valuta Weergave",
                     "current_interval_price_rating": "📊 Prijsbeoordeling",
+                    "price_level": "🏷️ Prijsniveau",
                     "volatility": "💨 Prijsvolatiliteit",
                     "best_price": "💚 Beste Prijs Periode",
                     "peak_price": "🔴 Piekprijs Periode",
@@ -320,6 +321,17 @@
                     "confirm_reset": "Ja, reset alles naar standaardwaarden"
                 },
                 "submit": "Nu Resetten"
+            },
+            "price_level": {
+                "title": "🏷️ Prijsniveau-instellingen",
+                "description": "**Configureer stabilisatie voor Tibbers prijsniveau-classificatie (zeer goedkoop/goedkoop/normaal/duur/zeer duur).**\n\nTibbers API levert een prijsniveau-veld voor elk interval. Deze instelling egaliseer korte fluctuaties om instabiliteit in automatiseringen te voorkomen.",
+                "data": {
+                    "price_level_gap_tolerance": "Gap-tolerantie"
+                },
+                "data_description": {
+                    "price_level_gap_tolerance": "Maximaal aantal opeenvolgende intervallen dat 'afgevlakt' kan worden als ze afwijken van omringende prijsniveaus. Kleine geïsoleerde niveauwijzigingen worden samengevoegd met het dominante aangrenzende blok. Voorbeeld: 1 betekent dat een enkel 'normaal'-interval omringd door 'goedkoop'-intervallen wordt gecorrigeerd naar 'goedkoop'. Stel in op 0 om uit te schakelen. Standaard: 1"
+                },
+                "submit": "↩ Opslaan & terug"
             }
         },
         "error": {
@@ -1157,4 +1169,4 @@
         }
     },
     "title": "Tibber Prijsinformatie & Beoordelingen"
-}
\ No newline at end of file
+}
diff --git a/custom_components/tibber_prices/translations/sv.json b/custom_components/tibber_prices/translations/sv.json
index ec576ca..a9422fb 100644
--- a/custom_components/tibber_prices/translations/sv.json
+++ b/custom_components/tibber_prices/translations/sv.json
@@ -136,6 +136,7 @@
                     "general_settings": "⚙️ Allmänna inställningar",
                     "display_settings": "💱 Valutavisning",
                     "current_interval_price_rating": "📊 Prisbetyg",
+                    "price_level": "🏷️ Prisnivå",
                     "volatility": "💨 Prisvolatilitet",
                     "best_price": "💚 Bästa Prisperiod",
                     "peak_price": "🔴 Topprisperiod",
@@ -320,6 +321,17 @@
                     "confirm_reset": "Ja, återställ allt till standard"
                 },
                 "submit": "Återställ nu"
+            },
+            "price_level": {
+                "title": "��️ Prisnivå-inställningar",
+                "description": "**Konfigurera stabilisering för Tibbers prisnivå-klassificering (mycket billig/billig/normal/dyr/mycket dyr).**\n\nTibbers API tillhandahåller ett prisnivå-fält för varje intervall. Denna inställning jämnar ut korta fluktuationer för att förhindra instabilitet i automatiseringar.",
+                "data": {
+                    "price_level_gap_tolerance": "Gap-tolerans"
+                },
+                "data_description": {
+                    "price_level_gap_tolerance": "Maximalt antal på varandra följande intervaller som kan 'jämnas ut' om de avviker från omgivande prisnivåer. Små isolerade nivåförändringar sammanfogas med det dominerande grannblocket. Exempel: 1 betyder att ett enstaka 'normal'-intervall omgivet av 'billig'-intervaller korrigeras till 'billig'. Sätt till 0 för att inaktivera. Standard: 1"
+                },
+                "submit": "↩ Spara & tillbaka"
             }
         },
         "error": {
diff --git a/custom_components/tibber_prices/utils/price.py b/custom_components/tibber_prices/utils/price.py
index 5bf2fd8..4eff217 100644
--- a/custom_components/tibber_prices/utils/price.py
+++ b/custom_components/tibber_prices/utils/price.py
@@ -11,6 +11,7 @@ if TYPE_CHECKING:
     from custom_components.tibber_prices.coordinator.time_service import TibberPricesTimeService
 
 from custom_components.tibber_prices.const import (
+    DEFAULT_PRICE_LEVEL_GAP_TOLERANCE,
     DEFAULT_PRICE_RATING_GAP_TOLERANCE,
     DEFAULT_PRICE_RATING_HYSTERESIS,
     DEFAULT_VOLATILITY_THRESHOLD_HIGH,
@@ -360,6 +361,39 @@ def _build_rating_blocks(
     return blocks
 
 
+def _build_level_blocks(
+    level_intervals: list[tuple[int, dict[str, Any], str]],
+) -> list[tuple[int, int, str, int]]:
+    """
+    Build list of contiguous price level blocks from intervals.
+
+    Args:
+        level_intervals: List of (original_idx, interval_dict, level) tuples
+
+    Returns:
+        List of (start_idx, end_idx, level, length) tuples where indices
+        refer to positions in level_intervals
+
+    """
+    blocks: list[tuple[int, int, str, int]] = []
+    if not level_intervals:
+        return blocks
+
+    block_start = 0
+    current_level = level_intervals[0][2]
+
+    for idx in range(1, len(level_intervals)):
+        if level_intervals[idx][2] != current_level:
+            # End current block
+            blocks.append((block_start, idx - 1, current_level, idx - block_start))
+            block_start = idx
+            current_level = level_intervals[idx][2]
+
+    # Don't forget the last block
+    blocks.append((block_start, len(level_intervals) - 1, current_level, len(level_intervals) - block_start))
+    return blocks
+
+
 def _calculate_gravitational_pull(
     blocks: list[tuple[int, int, str, int]],
     block_idx: int,
@@ -478,6 +512,75 @@ def _apply_rating_gap_tolerance(
         _LOGGER.debug("Gap tolerance: total %d block merges across all passes", total_corrections)
 
 
+def _apply_level_gap_tolerance(
+    all_intervals: list[dict[str, Any]],
+    gap_tolerance: int,
+) -> None:
+    """
+    Apply gap tolerance to smooth out isolated price level changes.
+
+    Similar to rating gap tolerance, but operates on Tibber's "level" field
+    (VERY_CHEAP, CHEAP, NORMAL, EXPENSIVE, VERY_EXPENSIVE). Identifies short
+    sequences of intervals (≤ gap_tolerance) and merges them into the larger
+    neighboring block.
+
+    Example with gap_tolerance=1:
+        CHEAP CHEAP CHEAP NORMAL CHEAP CHEAP → CHEAP CHEAP CHEAP CHEAP CHEAP CHEAP
+        (single NORMAL gets merged into larger CHEAP block)
+
+    Example with gap_tolerance=1 (bidirectional):
+        NORMAL NORMAL EXPENSIVE NORMAL EXPENSIVE EXPENSIVE EXPENSIVE →
+        NORMAL NORMAL EXPENSIVE EXPENSIVE EXPENSIVE EXPENSIVE EXPENSIVE
+        (single NORMAL at position 4 gets merged into larger EXPENSIVE block on the right)
+
+    Args:
+        all_intervals: List of price intervals with level already set (modified in-place)
+        gap_tolerance: Maximum number of consecutive "different" intervals to smooth out
+
+    Note:
+        - Uses same bidirectional algorithm as rating gap tolerance
+        - Compares block sizes on both sides and merges small blocks into larger neighbors
+        - If both neighbors have equal size, prefers the LEFT neighbor (earlier in time)
+        - Skips intervals without level (None)
+        - Intervals must be sorted chronologically for this to work correctly
+        - Multiple passes may be needed as merging can create new small blocks
+
+    """
+    if gap_tolerance <= 0:
+        return
+
+    # Extract intervals with valid level in chronological order
+    level_intervals: list[tuple[int, dict[str, Any], str]] = [
+        (i, interval, interval["level"])
+        for i, interval in enumerate(all_intervals)
+        if interval.get("level") is not None
+    ]
+
+    if len(level_intervals) < 3:  # noqa: PLR2004 - Minimum 3 for before/gap/after pattern
+        return
+
+    # Iteratively merge small blocks until no more changes
+    max_iterations = 10
+    total_corrections = 0
+
+    for iteration in range(max_iterations):
+        blocks = _build_level_blocks(level_intervals)
+        corrections_this_pass = _merge_small_level_blocks(blocks, level_intervals, gap_tolerance)
+        total_corrections += corrections_this_pass
+
+        if corrections_this_pass == 0:
+            break
+
+        _LOGGER.debug(
+            "Level gap tolerance pass %d: merged %d small blocks",
+            iteration + 1,
+            corrections_this_pass,
+        )
+
+    if total_corrections > 0:
+        _LOGGER.debug("Level gap tolerance: total %d block merges across all passes", total_corrections)
+
+
 def _merge_small_blocks(
     blocks: list[tuple[int, int, str, int]],
     rated_intervals: list[tuple[int, dict[str, Any], str]],
@@ -535,6 +638,63 @@ def _merge_small_blocks(
     return len(merge_decisions)
 
 
+def _merge_small_level_blocks(
+    blocks: list[tuple[int, int, str, int]],
+    level_intervals: list[tuple[int, dict[str, Any], str]],
+    gap_tolerance: int,
+) -> int:
+    """
+    Merge small price level blocks into their larger neighbors.
+
+    CRITICAL: This function collects ALL merge decisions FIRST, then applies them.
+    This prevents the order of processing from affecting outcomes. Without this,
+    earlier blocks could be merged incorrectly because the gravitational pull
+    calculation would see already-modified neighbors instead of the original state.
+
+    The merge decision is based on the FIRST LARGE BLOCK in each direction,
+    looking through any small intervening blocks. This ensures consistent
+    behavior when multiple small blocks are adjacent.
+
+    Args:
+        blocks: List of (start_idx, end_idx, level, length) tuples
+        level_intervals: List of (original_idx, interval_dict, level) tuples (modified in-place)
+        gap_tolerance: Maximum size of blocks to merge
+
+    Returns:
+        Number of blocks merged in this pass
+
+    """
+    # Phase 1: Collect all merge decisions based on ORIGINAL block state
+    merge_decisions: list[tuple[int, int, str]] = []  # (start_li_idx, end_li_idx, target_level)
+
+    for block_idx, (start, end, level, length) in enumerate(blocks):
+        if length > gap_tolerance:
+            continue
+
+        # Must have neighbors on BOTH sides (not an edge block)
+        if block_idx == 0 or block_idx == len(blocks) - 1:
+            continue
+
+        # Calculate gravitational pull from each direction
+        left_pull, left_level = _calculate_gravitational_pull(blocks, block_idx, "left", gap_tolerance)
+        right_pull, right_level = _calculate_gravitational_pull(blocks, block_idx, "right", gap_tolerance)
+
+        # Determine target level (prefer left if equal)
+        target_level = left_level if left_pull >= right_pull else right_level
+
+        if level != target_level:
+            merge_decisions.append((start, end, target_level))
+
+    # Phase 2: Apply all merge decisions
+    for start, end, target_level in merge_decisions:
+        for li_idx in range(start, end + 1):
+            original_idx, interval, _old_level = level_intervals[li_idx]
+            interval["level"] = target_level
+            level_intervals[li_idx] = (original_idx, interval, target_level)
+
+    return len(merge_decisions)
+
+
 def enrich_price_info_with_differences(  # noqa: PLR0913 - Extra params for rating stabilization
     all_intervals: list[dict[str, Any]],
     *,
@@ -542,6 +702,7 @@ def enrich_price_info_with_differences(  # noqa: PLR0913 - Extra params for rati
     threshold_high: float | None = None,
     hysteresis: float | None = None,
     gap_tolerance: int | None = None,
+    level_gap_tolerance: int | None = None,
     time: TibberPricesTimeService | None = None,  # noqa: ARG001  # Used in production (via coordinator), kept for compatibility
 ) -> list[dict[str, Any]]:
     """
@@ -558,6 +719,10 @@ def enrich_price_info_with_differences(  # noqa: PLR0913 - Extra params for rati
     remaining isolated rating changes (e.g., a single NORMAL interval surrounded
     by LOW intervals gets corrected to LOW).
 
+    Similarly, applies level gap tolerance to smooth out isolated price level changes
+    from Tibber's API (e.g., a single NORMAL interval surrounded by CHEAP intervals
+    gets corrected to CHEAP).
+
     CRITICAL: Only enriches intervals that have at least 24 hours of prior data
     available. This is determined by checking if (interval_start - earliest_interval_start) >= 24h.
     Works independently of interval density (24 vs 96 intervals/day) and handles
@@ -572,7 +737,8 @@ def enrich_price_info_with_differences(  # noqa: PLR0913 - Extra params for rati
         threshold_low: Low threshold percentage for rating_level (defaults to -10)
         threshold_high: High threshold percentage for rating_level (defaults to 10)
         hysteresis: Hysteresis percentage to prevent flickering (defaults to 2.0)
-        gap_tolerance: Max consecutive intervals to smooth out (defaults to 1, 0 = disabled)
+        gap_tolerance: Max consecutive intervals to smooth out for rating_level (defaults to 1, 0 = disabled)
+        level_gap_tolerance: Max consecutive intervals to smooth out for price level (defaults to 1, 0 = disabled)
         time: TibberPricesTimeService instance (kept for API compatibility, not used)
 
     Returns:
@@ -590,6 +756,7 @@ def enrich_price_info_with_differences(  # noqa: PLR0913 - Extra params for rati
     threshold_high = threshold_high if threshold_high is not None else 10
     hysteresis = hysteresis if hysteresis is not None else DEFAULT_PRICE_RATING_HYSTERESIS
     gap_tolerance = gap_tolerance if gap_tolerance is not None else DEFAULT_PRICE_RATING_GAP_TOLERANCE
+    level_gap_tolerance = level_gap_tolerance if level_gap_tolerance is not None else DEFAULT_PRICE_LEVEL_GAP_TOLERANCE
 
     if not all_intervals:
         return all_intervals
@@ -645,6 +812,11 @@ def enrich_price_info_with_differences(  # noqa: PLR0913 - Extra params for rati
     if gap_tolerance > 0:
         _apply_rating_gap_tolerance(all_intervals, gap_tolerance)
 
+    # Apply level gap tolerance as post-processing step
+    # This smooths out isolated price level changes from Tibber's API
+    if level_gap_tolerance > 0:
+        _apply_level_gap_tolerance(all_intervals, level_gap_tolerance)
+
     return all_intervals