Market Outlook – Traders are giving back gains with the news of China’s renewed lockdown. There are certainly questions surrounding those demonstrations – but if the regions are on total lockdown, how do they get out to demonstrate…hard to divide truth from fiction. Nevertheless, the markets are unsettled and giving back gains. Apparently, this ‘holiday hangover’ is a real thing in the markets so traders would likely have given back gains, but perhaps not as much. The levels to watch are clearly noted on the charts below. Dips are likely to be bought as traders feel seasonality is still driving charts north.
Observations -one from Jeff Macke, in particular, shows a mall jammed with people so folks are getting out to shop.
On Friday, everyone was selling calls and puts for premium -notice both the red line for puts and the green line for calls are both below zero. It will be interesting to note whether this continues or shifts. This actually means that sideways motion is likely what traders expect. Chart by unusualwhales.com
Before we get to the charts, here are a couple of recap images to see where we stand in terms of performance
Here’s the RTY with volume by price
China’s oil consumption