Although the s & p; 500 has tumbled 20 per cent from record levels for the first time since march 2020, trading volumes have been average, and according to other indicators, the collapse in us stocks may be a sign of poor performance in the short term, rather than a sign of unlimited panic, the Zhitong financial APP has learned.

It is reported that the Chicago Board options Exchange volatility Index (VIX index, or "panic index") is also below this month's high. Meanwhile, the Chicago Board options Exchange SKEW index is near a two-year low.

The CBOE SKEW Index can simply be used to measure the difference in implied volatility between put and call options on the S & P 500. The difference has an average level. If people think that U. S. stocks have the same probability of rising and falling, then the SKEW index is 100. If the options market for US stocks believes that the S & P is more likely to soar than plummet in the short term, the index will be less than 100. On the contrary, it is higher than 100.

Chris Murphy, co-head of derivatives strategy at Heiner International Group, believes thatThe decline in the stock market is not accompanied by a surge in trading volume. Generally speaking, trading volume increases when the market hits bottom, which is a sign of market surrender.

Max Gokhman, chief investment officer of AlphaTrAI, a financial investment firm, said the S & P 500 was relatively orderly and there were no obvious signs of panic, indicating that the bottom of the market had not yet appeared. Coupled with the fact that the Fed is stepping up policy tightening to catch up with inflation and putting the turmoil in US stocks behind, the market outlook is bleak.

Therefore, from the perspective of reverse investment, the relative lack of panic is not necessarily a good thing. In addition, Gokhman said the stock market will continue to fall until the rollercoaster year begins to return.

When did US stocks hit bottom?

It is understood that the current panic index is at 32. 'There is panic and anxiety in the market, but no one has surrendered and no one has sold stocks yet, but that day will come sooner or later, 'said Jay Kaeppel, an analyst at SentimenTrader.Historically, when the panic index reached the level of 40-45, the market fell sharply. So when the panic index reaches 45, it means the time has come.

Craig W. Johnson, chief market technical analyst at Piper Sandler, also expects the panic index to hit 40, using a proprietary technical indicator he calls "40-week technology," which measures how many stocks are above or below the 40-week moving average.

Julian Emanuel, chief stock and quantitative strategist at Evercore ISI, is looking at three indicators.Looking for signs that the market is bottoming out, the panic index is above 40, the CBOE SKEW index is 1.35, and trading volume is more than 20 billion shares.

It is understood that the SKEW index of the Chicago Board options Exchange is close to its lowest level since April 2020, and its put / call ratio, which tracks the number of options related to a single company, has jumped to 1.27, still below the threshold concerned by Evercore analyst Emanuel.

Will the US economy fall into recession?

Will the US economy eventually achieve a "soft landing" or fall into recession? In response, Mike Mullaney, head of global market research at Boston Partners, said that from a valuation point of view, analysts expect the S & P 500 to be valued lower and lower, and the market is likely to have more downside than upside.

Mullaney said that if the Fed wants to meet its inflation target, the US economy will fall into recession. However, the US recession could push the price-to-earnings ratio of the S & P 500 to about 13 times earnings, which could be a sign that "almost everything in the market is discounted".