Options markets expect the S&P 500 to move just 0.7% in either direction on Tuesday, even as a consumer-price index print, the start of earnings season and Fed testimony all land the same day. Citigroup data show that muted move arrives with the index hovering near a record high.
Traders are pricing a 0.7% swing in either direction for the S&P 500 on Tuesday, according to data compiled by Citigroup. That is a modest expected move, and it lines up with the average implied swing across the past 12 CPI days.
The calendar itself is anything but modest. Tuesday brings a consumer-price index reading, the kickoff to earnings season and testimony from the Federal Reserve chief, with flaring tensions in the Middle East adding to the mix. Yet equities traders appear unperturbed by the crowd of catalysts.
That calm is what makes the setup precarious. The stock market is hovering near a record high alongside the modest move now priced in.
Source: Bloomberg (snippet-based)
Trading involves risk.
Risk Disclaimer
