The US equity market has absorbed a ton of supply in late December between hedge funds (new shorting), pension funds (rebalancing into bonds), volatility control and systematic strategies (vol spike), and retail year-end.
Liquidity was also challenged and the gamma dynamic in the market quickly changed.
As we walk in today SPX futures scoreboard is up ~2% and exposure remains short and underexposed locally to a rally from here. I would not call it FOMO but more FOMU (fear of materially underperforming benchmarks) out of the 2025 gates.
