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?
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.
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.
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.