AwesomeCapital: Stocks & Crypto Erase Post-Fed Losses, Banks & Bond Yields Keep Dropping

Thursday, March 23, 2023

Stocks & Crypto Erase Post-Fed Losses, Banks & Bond Yields Keep Dropping

After yesterday's Yellen-driven bloodbathery in stocks, it seems a good night's sleep has calmed all those nerves and the machines are back in panic-buying mode.

Nasdaq is leading the charge but The Dow and S&P have also now erased all of the losses from the release of the FOMC statement...

We note the bounce in the S&P occurred around the 200DMA and it's now testing up towards its 50DMA...

Goldman's Scot Rubner notes that yesterday's rapid reversal was very much accelerated by 0DTE dynamics: On the move higher, dealers quickly bought call delta, then sold it all back out, this accelerated as put delta started to pick up, and increased supply as those puts went ITM late. Each day is its own ecosystem, and that was a short gamma dynamic...