Back on November 2, when the S&P was trading in the mid-4200s, just above a five-month low hit days earlier, we cautioned bears that the selling avalanche was about to end as a result of two key technical reasons: i) a flurry of stock buybacks - some $5BN per day - had just been unleashed now that the Q3 blackout period had ended, and ii) CTAs who were about go "apeshit" buying stocks purely on vol signals.
$5BN of buyback VWAP buy orders every day until Dec 8.— zerohedge (@zerohedge) November 2, 2023
CTAs about to go apeshit (buy triggers are ST 4339, MT 4349, LT 4329)
CTAs $207BN to buy in up tape over next month
For those who missed it the first time, we expanded on the reasons behind the melt up a few days later, adding such technical factors as dealer gamma, record shorting by hedge funds and bullish seasonals.