S&P 500 Keeps Eking Out Gains but Market Internals Are Flashing a Warning Sign

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S&P 500,US Small Cap 2000,NVIDIA Corporation

Stocks Analysis by Michael Kramer covering: USD/JPY, S&P 500, US Small Cap 2000, NVIDIA Corporation. Read Michael Kramer's latest article on Investing.com

, and the RSP is not quite wide, with the S&P 500 up 14.8%, the RSP up 3.9%, and the IWM up just 0.3% year to date.

Data from GammaLab shows a collapse in gamma levels, which normally leads to a great deal of volatility in the market. When gamma levels are very high, we tend to see very tight trading ranges, which really makes the price action the first three days of this week beyond strange.Additionally, the last few days have seen a huge drop in reserve balance, as noted by the rising reverse repo facility.

We will see if Micron’s only slightly better 3Q results and in-line 4Q guidance, along with a conference call that seemed to hold promise but was lacking in the details, will lead to the lower bound of the trend line in the SMH breaking.) is trading down by around 7% after hours. As that nearly 170% IV for the options expiring on Friday comes crashing down, and all the calls above $140 burn premium today, that $130 level is very important.

 

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