The last quadruple witching day of 2021 is affecting the S&P 500 index in ways that may reveal where the market may go next.

Every third Friday in March, June, September, and December is the expiration day for all stock futures, stock options, stock index futures, and stock index options at the same time. Because of the arbitrage opportunities, contract offsetting and closing, etc. market volumes and volatility increase which will most likely happen today. 

If we look at the previous two quadruple witching days, both of the times the index fell for a few days before the day. In June S&P 500 index continue its drop on the witching day but after, the trend reversed to the north.

On March’s witching day, the index made a Doji-like move. The index rose for one day on Monday, but the downtrend continues for 2 more days before turning north.

The key supports may be the key for what to expect from the index. 55 and 89-day moving averages are the key supports since the pandemic crash. If S&P 500 can hold above the 55-day moving average today, a short-term uptrend in the next week will be more likely. Otherwise, the odds of a fall to 89-day moving average will increase.