The 'SPX to close above 7500 this week' market has been wild. It was trading around 60% earlier and now it's down to 35% with $SPX at 7465.17. Is this just typical end-of-week jitters or is there some news I've missed that's driving the sell-off?
Seems like a pretty standard Friday afternoon fade to me. Happens all the time when there's no major catalyst. Plus, 7500 is a big psychological level.
Could be some positioning ahead of CPI next week, if you look at the vol curve. People might be taking profits on short-term gains.
Is there any whisper of a hawkish fed speaker or some geopolitical news? Sometimes these moves happen on really thin volume near the end of the week.
I wouldn't be surprised if it's just gamma hedging. With it trading at 60% earlier, a lot of people were probably long calls, and as it drops, the market makers are selling futures to stay delta neutral.