S&P500 Daily Action Areas & Price Targets 3/8/26

***QUOTING ES1! FOR CASH US500 EQUIVALENT LEVELS, SUBTRACT POINT DIFFERENCE***

WEEKLY BULL BEAR ZONE 7400/20

WEEKLY RANGE RES 7635 SUP 7410

MONTHLY RANGE RES 7838 SUP 7258

JHEQX Q3 Collar Short Call Cap: ~7,750 – 7,900 - Long Put Strike: ~7,050 – 7,100 (approx. 5% downside protection) Short Put Strike: ~5,950

DEC2025 OPEX to DEC2026 OPEX is 945 points giving us a range of [5889,7779]

SPX PUT/CALL RATIO 1.1 (The numbers reflect options traded during the current session.) A put-call ratio below 0.7 is generally considered bullish, and a put-call ratio above 1.0 is generally considered bearish.

GS Flow Desk: large S&P 31Aug 7000/7950 strangle in roughly $20mm vega / $115mm premium …My Read – classic “big convexity versus carry” trade: either someone paid a lot to own a wide August move, or someone got paid a lot to bet that the S&P stays comfortably inside the 7000–7950 corridor

DAILY VWAP BULLISH 7448

WEEKLY VWAP BEARISH 7522

MONTHLY VWAP BULLISH 7036

DAILY STRUCTURE - OTFH - 7427

WEEKLY STRUCTURE - BALANCE 7648/7247

MONTHLY STRUCTURE - OTFH - 7247

Balance: This refers to a market condition where prices move within a defined range, reflecting uncertainty as participants await further market-generated information. Our approach to balance includes favouring fade trades at the range extremes (highs/lows) while preparing for potential breakout scenarios if the balance shifts.

One-Time Framing Higher (OTFH): This represents a market trend where each successive bar forms a higher low, signalling a strong and consistent upward movement.

One-Time Framing Lower (OTFL): This describes a market trend where each successive bar forms a lower high, indicating a pronounced and steady downward movement.

DAILY BULL BEAR ZONE 7580/90

GAMMA FLIP 7478

DELTA FLIP 7445

DAILY RANGE RES 7571 SUP 7434

2 SIGMA RES 7638 SUP 7386

VIX BULL BEAR ZONE 17.9  (VVIX / VIX) 5.7

TRADES & TARGETS 

SHORT ON REJECT/RECLAIM DAILY BEAR ZONE TARGET CLOSE/GAMMA FLIP

LONG ON ACCEPTANCE ABOVE DAILY BULL BEAR ZONE TARGET 7630

***ADDITIONAL SETUPS & TARGETS HIGHLIGHTED ON THE CHARTS***

(I FADE TESTS OF 2 SIGMA LEVELS ESPECIALLY INTO THE FINAL HOUR OF THE NY CASH SESSION AS 90% OF THE TIME WHEN TESTED THE MARKET WILL CLOSE ABOVE OR BELOW THESE LEVELS)

GOLDMAN SACHS FICC & EQUITY TRADING DESK VIEWS

Momo Capitulation Is Mature, but the Rebound Will Be Choppy

Goldman’s latest factor/thematic note argues that the July momentum crash was historic. High-beta momentum delivered its worst one-month performance since the GFC, and thematic / factor volatility is now at post-COVID highs. The key investor debate has shifted quickly from “when do we buy the dip?” to “is this rebound sustainable?”

The answer is nuanced:

The technical unwind is likely in the later innings, but elevated factor vol, macro uncertainty, and mixed AI capex narratives argue for limited-loss upside structures rather than outright chasing.

Goldman’s preferred stance is to selectively buy AI hardware / bottleneck exposure, fade structural losers that squeezed during the unwind, and keep protection around August / September political and macro risks.

1. Momentum Capitulation: Historic Reset, Not an All-Clear

This week’s selloff erased most of the YTD gains in both US and European high-beta momentum factors:

• US high-beta momentum: GSPRHIMO

• European high-beta momentum: GSPEMOMO

This comes only weeks after these factors delivered record first-half rallies. The speed and magnitude of the reversal have pushed factor vol to its highest level since COVID, while index vol remains much more muted.

That is a critical market structure point: the pain has been concentrated in factors and themes, not fully expressed in headline index vol.

Positioning Reset

GS Prime and flow data show:

• Largest 3-day de-grossing since November 2022

• Sharp reduction in net exposure to YTD lows across:

  • Momentum

  • Mega-cap tech

  • Broad AI

• Fundamental long/short momentum exposure now in the 1st percentile versus the last six months

• But still around the 86th percentile versus five years

• Systematic long/short momentum exposure around the 34th percentile versus five years

This means near-term positioning is washed out, but the longer-term crowding impulse has not completely disappeared.

Trading Implication

The technical reset likely means most of the unwind has already happened. But because factor volatility is still extremely elevated, the rebound should be choppy.

Goldman prefers limited-loss expressions:

These structures reflect the idea that momentum can rebound, but outright delta exposure is still dangerous.

2. Which Dips Are Worth Buying? AI Hardware First

Goldman is most constructive on the AI hardware rebound. Despite volatility in hyperscalers, second-quarter prints reassured investors on the fundamental AI demand picture. The technical backdrop has also improved after the sharp de-grossing.

The preferred AI dip-buying areas are:

The key reason: fundamentals remain intact. AI infrastructure demand is still strong, and positioning has been materially reduced. For example, GSTMTDAT long/short positioning has halved from its peak over the last few weeks.

That creates a better risk/reward for hardware and bottlenecks than for crowded, broad AI beta.

3. Hyperscalers: Idiosyncratic Risk Near Term, but Better Medium-Term Setup

Goldman acknowledges near-term idiosyncratic risk in hyperscalers because AI capex and monetization narratives are diverging across the group.

The market is discriminating heavily between:

• Capex that drives visible revenue / operating leverage

• Capex that raises ROI concerns

• Cloud demand acceleration

• Margin control

• AI monetization timelines

But Goldman argues that over time, the market should reward hyperscaler capex if the group continues to deliver:

• Accelerating revenue

• Operating leverage

• Strong cloud demand

• Evidence of AI ROI

This matters because hyperscalers have underperformed the S&P by roughly 12 percentage points YTD. That relative underperformance creates scope for a catch-up if earnings remain strong.

Hyperscalers vs Non-Profitable Tech

Post-Fed, an increasingly unanchored long end should consolidate hyperscaler performance relative to non-profitable tech.

The logic:

• Long-end yields / term premium hurt speculative, long-duration, non-profitable tech more.

• Hyperscalers have earnings, cash flow, scale, and balance-sheet strength.

• If rates stay volatile, the market should prefer profitable AI platforms over unprofitable growth.

Goldman highlights that hyperscalers versus non-profitable tech performance has dislocated from the historical relationship with rates. That dislocation can normalize in favor of hyperscalers.

4. SPXXAI: The Best Hedge Became a Winner

SPXXAI has been the most robust hedge for the AI meltdown over recent weeks. It hit an all-time high on Tuesday before giving back some performance as investors began re-grossing AI exposure.

But Goldman makes a broader point:

SPXXAI is also the ultimate AI winner.

Why? Because as silicon and inference costs decline, AI benefits broaden beyond infrastructure suppliers to companies that adopt AI and use it to improve productivity and earnings leverage.

This is a crucial evolution in the AI trade:

Phase 1: Infrastructure Winners

• Semiconductors

• Datacenters

• Power

• Cooling

• Networking

• Memory

• Equipment

Phase 2: AI Adopters

• Non-AI companies using AI to cut costs

• Productivity beneficiaries

• Software adopters

• Industrial automation users

• Services companies with operating leverage

• Companies improving margins through AI deployment

So while SPXXAI worked tactically as a hedge, Goldman sees it as a strategic beneficiary of AI diffusion.

5. Rallies Worth Fading: Structural Shorts Have Re-Opened

The momentum meltdown caused structural shorts to squeeze sharply higher. Goldman sees that as a rare re-entry point for medium-term shorts.

AI-at-Risk

The key baskets:

These baskets rallied during July’s momentum unwind but have already started to give back gains. Goldman sees the squeeze as an opportunity to re-short structural AI losers.

The logic is that companies disrupted by AI may temporarily rally when AI winners de-gross, but their fundamental challenges remain.

Europe China Competition Losers

Goldman also highlights structurally challenged European multinationals vulnerable to China competition:

• GSXECHNX

This basket rallied +7% in July, but price action has dislocated from EPS. Valuation is now at the 85th percentile of its five-year history, making the rally fade attractive.

European Gas Consumers

Goldman sees European gas price risks skewed higher into year-end, which implies incremental margin pressure for gas-consuming stocks:

• GSXETTFX

The basket has rebounded roughly 5% from June lows, but Goldman sees potential for that rebound to unwind if gas prices rise.

6. Key Watchlist: Policy, Electricity, France

As second-quarter reporting winds down, the next few weeks are relatively catalyst-light. But September brings more political noise.

US Electricity Pricing

Goldman is focused on electricity pricing as a key US policy area. They expect:

• US IPPs: GSXUIPPs

• Domestic Solar: GSXUSOLR

to benefit from a sharp increase in renewable energy capacity additions through 2030E.

This fits the broader AI / power theme: electricity demand, grid capacity, and generation investment are increasingly important equity drivers.

Europe Political Risk

In Europe, the key watchpoint is French election headlines. Goldman flags:

• French Domestics: GSXEFRDO

as the most sensitive pocket to political risk and potential credit-spread widening.

Historically, periods of heightened political uncertainty coincide with correlation spikes between French domestics / internationals and OAT-Bund spreads. In other words, French domestic equities become more macro-credit sensitive during political stress.

7. Factor Vol vs Index Vol: The Core Market Structure Problem

One of the most important points in the note is the divergence between factor vol and index vol.

• Momentum factor vol is at post-COVID highs.

• The spread between US high-beta momo realized vol and SPX realized vol is one of the largest in a decade.

• Index vol remains relatively muted.

This is the same broader theme seen across dispersion, AI unwind, and crowded factor positioning: enormous volatility under the surface, but index volatility has not fully caught up.

That creates two possible outcomes:

Benign Outcome

• Factor unwind continues to normalize.

• Long-only investors add slowly.

• Buybacks provide support.

• Index remains rangebound.

• Factor vol falls back toward index vol.

Stress Outcome

• Correlations rise.

• Macro shock hits.

• Index vol catches up.

• Dispersion shorts are squeezed.

• Reverse dispersion / index vol protection works.

Given August liquidity and Fed / rates / geopolitics risk, Goldman still prefers limited-loss structures and protective trades.

8. Tactical Trade Map

9. What This Means for the Broader Market

The broader market implication is that the worst of the momentum liquidation may be behind us, but the market is not yet ready for a clean beta rally.

Why?

• Positioning is cleaner but not outright low on a five-year basis.

• Factor volatility remains very high.

• Index vol has not fully repriced.

• Long-only investors are still cautious.

• August liquidity is poor.

• Systematic downside flow risk remains asymmetric.

• Macro risks remain live: rates, Fed credibility, oil, geopolitics.

• Earnings catalysts become lighter after the Mag 7 reports.

That suggests the market can bounce, but rallies are likely to be uneven and leadership-specific.

Preferred leadership:

• AI hardware

• Datacenters

• Semis

• Power / electricity

• Profitable hyperscalers over non-profitable tech

• AI adopters / productivity beneficiaries

Avoid / fade:

• AI-at-risk losers

• Structurally challenged Europe / China-exposed multinationals

• Gas-consuming European equities

• Unprofitable tech in a high long-end-rate regime