(Bloomberg) — Don’t be fooled by the sanguine equity reaction to the Federal Reserve’s hawkish surprise. Some Wall Street strategists attribute the latest tranquility to a technical backdrop that’s about to shift Friday.

The quarterly event, known as “triple witching,” occurs when options and futures on indexes and equities expire. Of particular interest are trillion dollars of options tied to benchmarks like the S&P 500 Index, whose expiration Goldman Sachs Group Inc. and Nomura Securities say may open the door for turmoil.

How the dynamics work is a complicated process that the average investor may find it hard to grasp. But in the eyes of Charlie McElligott, a cross-asset strategist at Nomura, the selling of options linked to volatility has created a “long gamma” condition where options dealers — who typically need to hedge their positions by buying or selling the underlying stocks — tend to go against the prevailing market trend.

“‘Equities stable on hawkish Fed guidance’ is the wrong read here,” McElligott wrote in a note to clients. “Equities are stable for the same reason they’ve been chopping for weeks: markets continue choking on an oversupply of gamma from vol sellers!”

On Wednesday, the S&P 500 erased half of a 1% intraday loss as Fed policy makers said they now expect to raise interest rates twice by the end of 2023, sooner than previously anticipated. As tempting as it is to conclude that the prospect of a faster tightening cycle doesn’t bother stocks much, it’s worth noting that the market was already stuck in an eerie calm.

Measured by the 20-day volatility, the S&P 500’s price swings have dwindled to levels not seen since the start of 2020. Similar to McElligott at Nomura, Goldman strategists including Rocky Fishman blamed the long gamma positioning for the dormancy. More than $2 trillion of S&P 500 options and futures are scheduled to expire Friday, Goldman estimated.

“The extremely low SPX realized volatility is consistent with the possibility that 18-Jun has left ‘the street’ long index gamma, in which case realized volatility could pick up once positions are cleaner,” Fishman wrote in a note.

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The S&P 500 closed virtually flat on Thursday after falling as much as 0.7%.

Read more: How Many Witches Are Beguiling Stocks Today? It’s Just a Trio

The quarterly expiration, once called “quadruple witching,” usually coincides with a rebalancing of benchmarks such as the S&P 500, sparking single-day volumes that rank among the highest of the year. According to an estimate from Howard Silverblatt, senior index analyst at S&P, the rebalance in the index alone could force $30 billion of stock trades.

The last event in March saw more than 17 billion shares changing hands on exchanges, 20% above the three-month average.

While the robust volume offers a window of liquidity for trading, it can also create nuances for investors as the event makes it hard to tell whether a stock’s move is driven by adjustments related to option expiration, or reflects a change in business fundamentals, according to Matt Tuttle, chief executive officer at Tuttle Capital Management LLC.

“When you get one of these events, you get noises around share movements,” Tuttle said by phone. “It messes up the information that we’re seeing.”

(Adds Thursday’s trading in eighth paragraph)

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