The report notes elevated volatility alongside lighter rebound volumes versus last week’s sell-off, with potential for mean-reversion if megacap momentum wanes.

The near-term outlook for the market is two-sided: upside momentum could persist with megacap leadership, but rallies toward 9,000 remain at risk without sustained volume and a breakout above resistance, suggesting choppy trade around 8,900 unless a breakout occurs.

Options positioning points to 9,000 as a key resistance due to a gamma ceiling that may stall rallies on first tests, while 8,900 acts as a gamma magnet, implying mean-reverting action around that level.

Momentum has improved, yet the market is expected to stay range-bound with resistance near 9,000 and 8,900 acting as a gamma magnet that supports choppy trading.

Sector performance was mixed, with four sectors higher led by Materials and Energy, while six declined; Information Technology and Utilities lagged, and tech was hit hard by a 12-month low driven by Xero’s roughly 16% drop.

Divergence across sectors showed Materials and Energy gaining while Information Technology and Utilities weakened, with Xero contributing to the tech sector’s decline to a new 12-month low.

Overall, four sectors rose (notably Materials and Energy) and six fell, as Technology and Utilities underperformed amid a tech-led pullback.

Volatility remained elevated, with a high-low range surpassing 1% for four days in a row, while trading volumes fell for a third consecutive session.

The ASX 200 rebounded after the RBA move, with the ASX 20 leading gains and sentiment stabilizing, though momentum favors range-bound trading rather than a clear uptrend.

Following post-RBA losses, the ASX 200 closed above 8,900 as megacaps led gains, helping lift broader sentiment.

Wednesday’s rebound for the ASX 200 was aided by strong megacap performance, lifting the ASX 20 and stabilizing sentiment after earlier weakness tied to a hawkish RBA and Wall Street softness.

SPI 200 futures remain above the daily VWAP, signaling short-term momentum support, but a weekly VWAP near 8,800 suggests a longer-term value disconnect and potential mean-reversion if 9,000 is not decisively breached.