The Cboe Volatility Index (VIX) closed at 12.77, marking its lowest level in nearly five months, indicating a period of reduced market volatility. This decline in the VIX suggests that bearish sentiment among traders is subsiding. In related market activity, Bank of America reported that the S&P options market is anticipating a modest 64 basis point move for the upcoming Consumer Price Index (CPI) report, the smallest implied reaction since inflation began to rise in 2021. Additionally, one-month implied volatility for the S&P 500 reached a two-year low, while the MOVE Index, which measures implied volatility for U.S. Treasuries, had only seen lower levels on one occasion in the past two years. Traders are adapting to this low volatility environment, with notable activity observed in options trading strategies.