S&P 500 Trapped by Hedge Positions - Here’s What Needs to Happen for a Breakout

Nasdaq 100 News

S&P 500 Trapped by Hedge Positions - Here’s What Needs to Happen for a Breakout
S&P 500Micron Technology IncIshares Russell 2000 ETF
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Stocks Analysis by Michael Kramer covering: Nasdaq 100, S&P 500, Micron Technology Inc, iShares Russell 2000 ETF. Read Michael Kramer's latest article on Investing.com

closing flat yesterday, it was a reasonably weak session overall. Within the index, only 132 stocks advanced, while 368 declined. The Bloomberg 500 indicates that the “Troubling Three” stocks did all the heavy lifting yesterday.However, when examining a chart of the IWM, it doesn’t appear to be signaling an upward trend, so it’s unclear where this optimism is coming from.

As the notional value of the calls decays, market makers need to cover their short positions, and to do that they buy back the S&P 500. This action is somewhat supportive of the market because we are so close to that strike price. Interestingly, the notional delta value seems relatively insignificant at just $10 billion. I believe that all it would take is one good day of substantial volume to break this range.Historically, over the last two years, when we see the yield curve steepening, it tends to lead to more of a correction in the Nasdaq 100, and at least over the past few days, that has yet to be the case.) reported results that came in a little ok, but with solid guidance.

Much to their credit, they reported solid guidance, and the stock cleared that high watermark at $103, so there’s not much more you can say there.

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S&P 500 Micron Technology Inc Ishares Russell 2000 ETF

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