Underneath, the 200-Day EMA is closer to the 4250 level, and that could be an area where we would see longer-term algo traders will be paying close attention to it. There are a lot of headwinds out there right now and I do think that will continue to be the main issue going forward.
After all, this is a market that has to deal with a lot of questions around the world when it comes to global growth, and of course inflation as well. There are a lot of concerns when it comes to central banks around the world, because suddenly they are slowing down, and therefore it’s likely that we would see traders worried about what central bankers see on the horizon. However, market participants might be looking for value so that might let this market just a little bit.
For what it is worth, dealer gamma is negative at the moment, meaning that if we continue to drop, they will have to start selling, and therefore we could see the S&P 500 really pick up to the downside.
