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I have Landsat level-2 NDVI tiles I am using in ArcMap 10.4.1.; however, the level-2 NDVI data in ArcMap ranges from -5,189 to +20,000.

The spectral image product guide (which I've linked) says that the valid range for level-2 NDVI is -10,000 to 10,000 with a scale factor of 0.0001, which makes sense. The saturate value is 20,000. I don't understand what the saturate value is and why the upper bound of the level-2 NDVI layer is 20,000.

I understand that to get NDVI values I need to multiply the level-2 layer by 0.0001. However, I'm unsure what to do about the saturate values since they are above the valid range. I'm guessing that the saturate value indicates pixels that are unusable; in other words, once I multiply the level-2 layer by 0.0001, I would then throw out all pixels >1. Is this correct?

https://landsat.usgs.gov/sites/default/files/documents/si_product_guide.pdf

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The saturate value of 20,000 is used to identify unused pixels (out of range of the valid pixels) for NDVI and other indices. Saturated pixel values occurred due to high reflectance that cause the DN values of Landsat 8 to reach their maximum value of 65535, indicating sensor saturation. Usually, pixel saturation occurs in the clouds, fires and lava flows etc.

You can refer to this article: Landsat-8 Operational Land Imager (OLI) Radiometric Performance On-Orbit that provides more details about Landsat 8 and saturated pixel values

The -10,000 to 10,000 with a scale factor of 0.0001 that produces a range of -1 to 1 is the valid range of NDVI. In your case you can mask the pixel values of 20,000 if you have any as these pixels do not provide valid NDVI information.

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