S&P 500: Volatility Crush Rally Potential Builds as Dispersion, Correlations Shift

The S&P 500 showed resilience on Thursday despite a May jobs report, with the VIX falling below 16 and VIX1D below 11, suggesting potential for a volatility crush rally. Broadcom's earnings report significantly reduced single-stock volatility and dispersion, while oil's 3% decline also helped reduce equity volatility. Three-month implied correlations rose, narrowing the spread with dispersion, which historically precedes S&P 500 movements. An inverse head-and-shoulders pattern in oil remains valid as long as it stays above $90.50.