Cracks Emerge

MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN APPLE LONG-TERM

Stocks fell today after Powell signaled the Fed wasn't done raising rates. Tomorrow he goes in front of the Senate, and at times the Senate has seen a lot more action, especially between Elizabeth Warren and Powell. 

Today was the day that saw a rotation out of the NASDAQ Big 7 and into a more diversified group, with the RSP dropping by only 14 bps while the S&P 500 fell by 52 bps, and the Nasdaq 100 dropped by 1.35%.

Signs are emerging that the rally is now fading behind us. 0DTE has played a hefty hand in the market's rally, especially with the implied volatility levels declining. The chart below shows how the 1-week 50 Delta S&P 500 options have seen volatility levels grinding lower over the past few weeks and how that has led to the call volume on the S&P 500 moving sharply higher, no doubt helping to fuel the rise in the S&P 500.