Morning market:
The US stock market continues to have a strong gaining session with most cash flow still coming from pressure of large-volume put options trading across the entire market. Buyers appeared right from last night when Europe started opening and squeezed short sellers across both stock and bond markets, pulling S&P500 past 3700 and continuing past 3750 this morning, before starting to slow down as it approaches the volatility trigger point at 3800, where the market may enter a stable state, and gamma-reduced movement (movement range from options influence increasingly low, helping to stabilize the market and investor sentiment). Overall, the rally over the past 2 days is typical of a put-cover on the options market, sharp rally but with many unstable characteristics, especially as put buyers start to liquidate positions near ATM but have not abandoned those far OTM positions, as shown in the IV charts below.
Job data released this morning shows the labor market starting to face pressure from interest rates, reinforcing investors' hopes that the FED will have to ease policy sooner than expected, leading to cash flow into mega tech and especially consumer-tech.
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