Week of September 30
SPX holds the breakout as we enter October.
Recap of last week
SPX closed basically unchanged at up 0.46%. Dealers were long ~10bn gamma at spot throughout the week meaning realized volatility was extremely subdued, lowest since early July. Essentially the index is pinned. However many big market developments took place last week, and this range compression will eventually lead to range expansion. This is all potential energy building up.
Chinese stimulus. Every rally in the past 3 years has been a sell the rip situation. Is this time different.
Ishiba wins the LDP leadership vote, likely Japan’s next Prime Minister. A well-known hawk, and is determined on ending the low interest rate regime Japan has been mired in for decades. Very bullish JPY.
Technicals, fund positioning, volatility as we enter a new month.
Next move for markets