SPX Gamma Wrap
The SPX managed to close only 0.7 percent lower after being down 2.5 percent intraday.
The sentiment that was already damaged by a lowered guidance from Snap took another more serious hit after a report showed that new home sales in the US decreased 16.6 percent month-over-month in April, while also the number for March was revised lower.
According to a lengthy rant by Bill Ackman on Twitter inflation is already out of control and expectations are getting out of control. The downward market spiral will end only end if either the Fed draws a line in the sand, or with a full blown collapse, according to Ackman.
Gamma discussion:
Dealer gamma declined by 98MM to -843MM compared to yesterday and gamma inversion moved lower by 35 points to 4250.
We continue to see 4000 as a resistance level, while 3900 slowly develops into the new pivot with both calls and put being accumulated at that location.
Looking further down the strike spectrum we see 3700 as a worst case support, as dealer flows will come to a stop between here and 3600.
It is also noteworthy however, that put volume was again very high today at 3400 and it seems that big investors are not playing around as put open interest increases at a rapid pace at this low level. What is going on?
The sentiment that was already damaged by a lowered guidance from Snap took another more serious hit after a report showed that new home sales in the US decreased 16.6 percent month-over-month in April, while also the number for March was revised lower.
According to a lengthy rant by Bill Ackman on Twitter inflation is already out of control and expectations are getting out of control. The downward market spiral will end only end if either the Fed draws a line in the sand, or with a full blown collapse, according to Ackman.
Gamma discussion:
Dealer gamma declined by 98MM to -843MM compared to yesterday and gamma inversion moved lower by 35 points to 4250.
We continue to see 4000 as a resistance level, while 3900 slowly develops into the new pivot with both calls and put being accumulated at that location.
Looking further down the strike spectrum we see 3700 as a worst case support, as dealer flows will come to a stop between here and 3600.
It is also noteworthy however, that put volume was again very high today at 3400 and it seems that big investors are not playing around as put open interest increases at a rapid pace at this low level. What is going on?
כתב ויתור
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