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Typically reduced air pressure may feel less jittery, but sidewall flex is reduced greatly.
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Typically, anything but the recomended pressure for the tires or car will decrease performance. So reducing it if its high will improve handling. Same with more air if its low. MY experience has been an underinflated tire gets much more sidewall flex. Lowering the pressure a little will give a larger footprint and more traction, but too much will ruin handling altogether. The less air pressure keeps the tire from holding its shape well, and the sidewalls flex quite a bit on cornering. With increased air pressure you get much less sidewall flex, but you have a smaller footprint, less traction and hold on the road, and subsequently worse handling.
I could be wrong, but the less inflated the tire gets the more sidewall flex you get is what i always thought / noticed.