Midday market 06/08: NASDAQ technical bounce, market heads toward FOMC

NASDAQ technical bounce 10 EMA daily, S&P500 continues to move within range ahead of FOMC

Market stabilizes again in Thursday's trading session with mega cap tech stocks rebounding in the morning, Tesla, Amazon, and Nvidia receiving the most investor attention. Most of the morning buying across the entire NASDAQ block came from shorts-cover rally after traders panic bought QQQ puts yesterday. Notably, during yesterday's sector rotation, both call and put volume of QQQ hit record levels with call volume the 7th highest in history and put volume the 11th highest in history.

With volatility continuing to hold the downward trend in the morning from yesterday, put holders forced to cover in the morning across the entire index, creating pressure that helped QQQ bounce back through the important 350 gamma flip level after an extremely volatile first 30 minutes. However, the absence of organic buyers here shows that today's rally in the tech block has more 'technical' characteristics than the sector rotation trend having truly ended.

In IWM, after receiving the 2nd largest call volume in history yesterday, it temporarily pulled back lightly in the morning after unemployment claims data weighed on the 'soft landing' mindset that had driven small caps up over the past week. SPX meanwhile continues to bounce back within the 4250-4300 range established ahead of FOMC.

Unemployment data supports the process of pausing rate hikes

Number of unemployment benefit claims last week surged to 261,000 from the expected 235,000. This is the highest level since 07/2021.

Eurozone officially enters economic recession in the first 3 months of the year after Q1 GDP updated to -0.1%

Crude oil price breaks sharply after surprise news of US and Iran close to reaching nuclear deal allowing Iran to export oil