One-Day Options Binge Making Market Macro Tea Leaves Unreadable
- S&P 500’s reversals around CPI seen fueled by 0DTE options
- The dynamic adds layer of noise to an already confusing market
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Quick: how did equity traders feel about inflation after Tuesday’s consumer price index hit? Depends on when you asked.
Everyone was bullish right after it came out. S&P 500 futures soared 1% as traders decided disaster had been avoided. Three and a half hours later, that optimism had evaporated: the index was down 1%. By the close stocks were back where they started, marking the third time they’d swung so widely this month alone.