Market Insights: Friday, April 25th, 2025

Market Overview

Stocks extended their winning streak on Friday, with the S&P 500 locking in a fourth consecutive day of gains—the longest stretch since January. The session was fueled by a surge in Big Tech, led by Tesla, which spiked nearly 10% on optimism about entering the Indian market and easing U.S. regulations on self-driving technology. President Trump’s latest comments kept tariff negotiations at the forefront, adding both caution and hope to market sentiment. While the Dow barely moved, the S&P 500 rose 0.7%, and the Nasdaq led with a 1.3% gain. Trump reiterated that tariffs on China would remain unless significant concessions were made, and downplayed the chances of another tariff pause. Meanwhile, reports that China could temporarily lift its hefty tariffs on some U.S. goods added a layer of optimism. Alphabet rallied after announcing a dividend hike and a massive stock buyback following strong earnings, although Intel slipped despite beating expectations. T-Mobile and Skechers also fell, highlighting early signs of tariff-related pressures. Tech and consumer discretionary sectors led the week’s rally, pushing all three major indices into solid weekly gains. The S&P 500 rose over 4% for the week, while the Nasdaq jumped nearly 6%. The "Magnificent Seven" stocks all moved higher, capped by Tesla’s standout performance, gaining more than 18% in the past five sessions. Looking ahead, markets are bracing for a heavy earnings slate next week, with key reports due from Microsoft, Meta, Apple, and Amazon.

SPY Performance

SPY climbed 0.71% to close at $550.64 after opening at $536.72. It traded between a high of $551.05 and a low of $543.70. Volume was relatively light at 54.44 million shares, suggesting a potential pause after the recent rally. The strong close near the session high underscores bullish momentum, and SPY’s hold above $550 could pave the way for higher resistance levels to be tested in the coming days.

Major Indices Performance

The Nasdaq was the top performer among the major indices, gaining 1.26% as tech stocks powered higher. The S&P 500 followed with a 0.71% increase, marking its fourth straight day in the green, while the Dow edged up just 0.03%, showing some signs of fatigue. The Russell 2000 slipped slightly by 0.07%, underperforming as small caps lagged. Investors remained focused on trade developments and the possibility of rate cuts, which provided underlying support for risk assets despite mixed performance across indices.

Notable Stock Movements

Tesla led the charge, soaring over 9.8% on excitement about its potential entry into India and regulatory tailwinds for self-driving technology. Nvidia added more than 4.3%, contributing to a broad tech rally. The rest of the Magnificent Seven also closed higher, with all members solidly in the green, reflecting continued investor confidence in growth stocks. This performance highlighted the market’s renewed appetite for risk, even as macroeconomic uncertainties linger.

Commodity and Cryptocurrency Updates

Crude oil edged up 0.65% to $63.20, though our long-term forecast still sees it moving toward $50, where we would be buyers. A short-term rally could occur if the dollar weakens, but we expect the dollar to firm as interest rates rise, putting further pressure on oil. Gold slipped 0.92% to $3,318 as investors rotated out of safe havens amid the risk-on environment. Bitcoin jumped 1.95% to close just above $95,200. We continue to favor buying Bitcoin between $77,000 and $83,000, targeting profits above $85,000, but caution against positions below $77,000 due to potential downside risks.

Treasury Yield Information

The 10-year Treasury yield fell 1.09% to 4.258%, offering modest support to equities. While yields remain elevated, this slight decline alleviated some pressure from risk assets. Equities remain sensitive to yield movements, and any surge above 4.5% could prompt renewed selling. A climb past 5% would signal serious trouble for stocks, likely triggering a sharp correction of 20% or more.

Previous Day’s Forecast Analysis

Thursday’s forecast projected a trading range of $535 to $555, with a slightly bullish bias supported by Call-side strength. Resistance was seen at $550, $552, $555, and $557, while support was identified at $545, $542, $540, and $535. The model leaned bullish above $545, targeting $550 and $555, with a drop below $545 suggesting a test of $542 or $540. Traders were encouraged to watch for failed breakouts near $555 or breakdowns at $545 to guide trades.

Market Performance vs. Forecast

SPY’s actual movement aligned well with the forecast. It traded from a low of $543.70 to a high of $551.05, staying within the projected range. The close at $550.64 validated the slightly bullish bias, with resistance at $550 being tested and marginally exceeded. Long trades above $545 were profitable, particularly for those targeting $550, as anticipated. The day’s action confirmed the importance of the $545 level and highlighted that bulls remain in control near key resistance.

Premarket Analysis Summary

In today’s premarket analysis posted at 8:11 AM, SPY was trading at $544.96, with a bias level set at $547. The outlook suggested "tumbling consolidation" with potential tests of both edges of the range. It noted that unless SPY convincingly broke above $547, rallies should be sold, targeting downside levels at $541 and $538. However, a strong push above $547 would open paths to $550 and $554. The favored strategy was to fade moves at the edges of the range rather than trade in the middle.

Validation of the Analysis

The premarket analysis was once again on point. SPY broke above the $547 bias level early, climbed steadily, and touched $550 and slightly beyond to $551.05 before closing at $550.64. The call to fade the edges proved valuable, as SPY did not linger in the middle range but rather trended higher after reclaiming $547. Traders who followed the bias level for long entries had clear profit-taking opportunities at $550, as outlined in the premarket plan.

Looking Ahead

Next week’s economic calendar picks up steam starting Tuesday with JOLTS Job Openings, followed by key releases including ADP Non-Farm Payroll, GDP, and PCE on Wednesday. Thursday brings Unemployment Claims and PMI, while Friday wraps up with the all-important Monthly Jobs Report. These data points are likely to inject fresh volatility into the markets and may shape near-term sentiment significantly.

Market Sentiment and Key Levels

SPY’s close at $550.64 strengthens the bullish case, but the market now hovers near crucial resistance levels. Resistance lies at $555, $557, $560, and $565, while support holds at $546, $541, $540, and $535. If SPY pushes above $555, we could see a move toward $560 or higher. A drop below $546 would likely test $541 and $540. Bulls have the edge, but caution is warranted with critical data releases looming next week.

Expected Price Action

Our AI model projects a trading range of $542 to $558 for Monday—this is actionable intelligence. The wide range points to the potential for trending moves. The bias remains bullish, driven by Call-side dominance. If SPY stays above $545, expect a test of $555, with $560 also in play. A break below $545 could target $541 and $540. Look for failed breakouts near $555 or failed breakdowns at $545 to guide trading decisions.

Trading Strategy

Long trades are favored if SPY holds above $545, with targets at $550, $555, $557, and $560. A break above $560 could trigger a move toward $565. Short trades are viable below $545, aiming for $541, $540, and $535, or above $555. The VIX closed at 24.84, indicating slightly lower but still elevated volatility. Manage risk with tight stops near resistance and consider reducing position size as markets digest gains. Be alert for reversals near key levels.

Model’s Projected Range

The model's maximum projected range for Monday is $541.25 to $560.25, with the Call side dominating. This suggests continued strength behind the recent four-day relief rally, despite a broadly volatile market. While price action has spanned a wide range, the market now needs time to consolidate around the $550 level. As a result, expect more choppy behavior on Monday, with intermittent trending moves. We maintain a stance favoring two-way trading while remaining cautious, viewing this as a temporary rally within an ongoing bear market. With SPY closing just above $550, the bulls have gained a stronger foothold. The $535 level remains critical—above it, bullish sentiment dominates; below it, the bears regain control. While a short-term bottom may have formed, the broader market still appears vulnerable to another leg down, especially as prices approach the $565–$585 zone, where a retest or breach of recent lows remains possible. Historically, declines of this nature tend to unfold 4 to 16 weeks after an initial bottom, so we strongly recommend considering protective strategies or reducing long exposure as key resistance levels are tested. Next week brings a wave of earnings, with many companies likely to highlight tariffs in their cautious forward guidance, adding to the elevated volatility already driven by current administration policies. Key technical levels for Monday: Resistance: $550, $555, $557, $560, $565. Support: $546, $541, $540, $535. Monday is light on economic data. Following four strong sessions that pushed SPY from above $535 to a high of $551, some consolidation or choppiness is expected. Bulls must defend levels above $535 to continue pressing higher, with a potential pathway to full control if they can close above $585. Conversely, if bears drive SPY below $535, a gap fill to $530 becomes likely before the next directional move emerges. Tariffs, bond yields, and inflation remain the dominant macro drivers likely to shape market behavior over the next 90 days, or until more definitive signals come from the White House. The VIX closed at 24.84, nearing the 23 level, which would provide further support for equities. The broader bearish trend channel from the December highs remains intact, with SPY now testing the upper boundary. While movement in either direction is possible within this structure, price action is likely to stay largely contained, with significant resistance near $555 and support around $465. Momentum has shifted in favor of the bulls; however, in this volatile environment, we recommend staying nimble and prepared for rapid changes in direction. 

Market State Indicator (MSI) Forecast

Current Market State Overview:
The MSI is currently in a wide Bullish Trending Market State, with price closing at MSI resistance. Extended targets printed for much of the morning session until 1:30 pm indicating the herd was participating in today’s push higher. The MSI range is wide indicating a strong bull trend. But without extended targets, with SPY at a major resistance level at $550, the push significantly higher on Monday could be met with heavy resistance. Overnight, SPY traded in a narrow range below $550 as forecast. The MSI did not rescale higher until 12:42 pm when it put in a series of higher rescalings with extended targets above indicating the herd was participating in the move to the day’s highs. Extended targets stopped printing fairly quickly which saw SPY trade within the MSI range for the rest of the day. Currently, MSI support stands at $546.74 with resistance at $550.75.
Key Levels and Market Movements:
On Thursday, we noted: “we expect the market to take a breather, with more consolidation punctuated by periods of trending price action.” We also stated, “we’ll see price testing $540 to set up for a push toward $550,” and finally, “Resistance remains strong above $545, extending all the way to $555, so any move beyond today’s highs is likely to be measured and deliberate.” With this in mind, at the open, price was trading at major resistance around $545 and extended targets were printing. The only viable trade was to seek a long on a failed breakdown, aiming for a test of $550. Fortunately, the market complied. At 10:28 am, SPY set up a less-than-perfect failed breakdown at $544, triggering a long entry. Based on our premarket levels, our first target was $547, more than $1 above the entry, so we chose to take profits there as the MSI remained in a narrow bullish state, well below our entry. Price consolidated around $547 for a bit before breaking higher. Our next level, drawn from both pre- and post-market data, was $550, where we planned to secure 20% of our position. That level hit by 1:15 pm, so we moved our stop to breakeven after locking in the second target. With 10% left as a runner, we waited for price to attempt new daily highs. However, price reversed and retested MSI support at $546.75. Knowing SPY has over a 70% probability of retesting MSI resistance from MSI support, we reloaded our long, targeting $550 once again, with a second target at MSI resistance. Both targets hit by 2:40 pm, and with extended targets no longer printing, we exited the remaining 10% at $551, closing the day two-for-two and wrapping up another strong week. We followed our core mantra: have a solid plan, execute with discipline, and let the MSI and model levels guide every decision. The MSI reveals who’s in control, when control shifts, and where key actionable levels lie—allowing for precise entries and exits. Combined with our model levels and daily strategy, it keeps us aligned with dominant market forces. It continues to deliver with high precision, helping traders avoid traps, stay in sync with momentum, and take profits confidently. We strongly recommend integrating the MSI into your trading toolkit. Paired with a structured plan, it becomes a powerful driver of long-term performance.
Trading Strategy Based on MSI:
Monday brings no economic data, but as we’ve noted since the new administration took office—anything can happen. Barring unexpected events, we expect the market to slow down, with more consolidation punctuated by brief periods of trending price action. This environment should offer solid two-way trading opportunities, as bulls may retest some of today’s gains, potentially down to $542. We don’t expect price to fall much below $542 without an external catalyst. For a breakout toward $555, SPY will need to backfill and build momentum to push through the heavy resistance above $550. Holding $535 remains critical for bulls to maintain upward momentum. A failure at that level could lead to a gap fill and push price toward $525 or lower. Resistance remains strong above $550, extending to $562, so any move beyond today’s highs is likely to be measured and deliberate. The edge still belongs to the bulls, but that could shift quickly if $535 fails. Bulls won’t fully reclaim control unless SPY regains $585, so caution is warranted. The 200 DMA at $562 is also expected to provide significant resistance. As always, trade what’s in front of you—lean on the MSI and stay nimble. The MSI updates in real time, revealing intraday structure and momentum shifts, helping you avoid outdated narratives or stale assumptions. For Monday, expect two-way trading with a focus on failed breakouts and breakdowns. Avoid trading into extended targets or fighting a wide MSI range. The Premarket Report provides fresh data and AI-driven insights to shape your daily strategy. MSI shows real-time momentum and control shifts, while our model levels define high-probability targets and precise entry zones. Together, MSI and model levels keep you aligned with dominant market forces and help you avoid costly missteps. If you’re not already using these tools, now’s the time. Reach out to your rep—these are true game-changers in markets like this.

Dealer Positioning Analysis

Summary of Current Dealer Positioning:
Dealers are selling $552 to $570 and higher strike Calls while also selling $546 to $551 Puts,  implying the Dealers belief that prices will continue to move higher on Monday. Dealers do not sell close to the money Puts unless they are convinced prices will move higher. That said, Dealers also are selling large quantities of Calls above $555 so perhaps there is a ceiling in play for Monday at this level. To the downside Dealers are buying $545 to $500 and lower strike Puts in a 2:1 ratio to the Calls/Puts they are selling, implying a neutral to slightly bullish posture for Monday. Dealer positioning has changed from slightly bearish to neutral/slightly bullish.
Looking Ahead to Next Friday:
Dealers are selling $551 to $600 and higher strike Calls while also buying $557 to $560 Calls implying Dealers see a likely top at $570 for next week. That said Dealers want to see price break $560 before committing lots of dollars to long Calls. Dealers wish to participate in any move toward $570 should that transpire. To the downside, Dealers are buying $549 to $435 and lower strike Puts in a 3:1 ratio to the Calls they’re buying/selling. This reflects a slightly bearish outlook for next week. Dealers are heavily protected should $535 fail but are also open to prices reaching $570 and possibly beyond. Dealer positioning is unchanged from slightly bearish to slightly bearish. We advise reviewing Dealer positioning daily for directional clues. These positions evolve quickly and tracking them is essential for staying ahead of shifting market sentiment.

Recommendation for Traders

With SPY closing at $550.64 and the VIX at 24.84, traders should stay nimble as volatility remains elevated. Long trades are attractive above $550, targeting $555, $557, and $560. Short setups become viable below $546, aiming for $541, $540, and $535. Manage risk tightly around key levels, particularly with light economic data until Tuesday. Review our premarket analysis before 9:00 AM ET to adapt to evolving conditions and Dealer positioning.

Good luck and good trading!