Market Insights: Thursday, May 1st, 2025

Market Overview

The Nasdaq roared higher Thursday as the AI trade reignited, pushing tech stocks to fresh gains and lifting all major indices to their eighth consecutive advance. Microsoft and Meta led the charge after delivering blockbuster earnings that calmed investor fears over the potential impact of President Trump’s tariffs on corporate tech spending. Microsoft jumped over 7.6% and Meta climbed 4.2%, both far surpassing Wall Street estimates and easing concerns about AI and advertising investment headwinds. The S&P 500 gained 0.6%, while the Nasdaq surged 1.52%, marking the day’s strongest performance. The Dow rose 0.21%, extending its longest win streak of the year. Apple reported after the bell, beating expectations on strong iPhone sales and approving a $100 billion buyback. Amazon also beat Q1 expectations, but its weaker-than-expected Q2 guidance weighed on shares in after-hours trading. Both companies remain in the spotlight amid President Trump’s 145% tariff on Chinese imports. Apple is attempting to shift production away from China, while Amazon has publicly committed to absorbing the cost of tariffs rather than passing them on to consumers. Meanwhile, McDonald’s blamed tariffs for its earnings miss, citing growing consumer uncertainty. The economic backdrop remains fragile. Unemployment claims rose to a two-month high, with continuing claims hitting their highest level since late 2021. The weak labor data follows a surprise GDP contraction earlier in the week, setting the stage for Friday’s closely watched monthly jobs report. Despite these concerns, sentiment improved after reports emerged that the U.S. has reached out to China in hopes of restarting trade negotiations, potentially easing global trade tensions.

SPY Performance

SPY posted a solid gain of 0.71% on Thursday, closing at $558.47 after reaching an intraday high of $564.07. It opened at $547.57 and dipped to a low of $557.86 before bouncing higher. Volume came in below the prior day’s surge at 55.29 million shares, but still above average. Thursday’s upward continuation further validated the bullish momentum, with SPY not only clearing key levels but holding gains into the close. Bulls appear to be in solid control above the $550 level, with price action continuing to hug the upper edge of the recent breakout range.

Major Indices Performance

The Nasdaq led Thursday’s rally with a 1.52% jump, fueled by Big Tech’s blowout earnings. The S&P 500 followed with a 0.6% gain, while the Dow rose 0.21% to notch its eighth straight win. The Russell 2000 climbed 0.55%, recovering from recent underperformance. A better-than-expected showing from Microsoft and Meta offset lingering concerns over tariffs and inflation. Defensive names lagged, as investor appetite shifted toward growth sectors on renewed optimism about AI and tech resilience. Though economic data revealed fresh labor market weakness, traders shrugged it off, betting on strong corporate earnings and a possible de-escalation in U.S.-China tensions.

Notable Stock Movements

Microsoft stole the spotlight, soaring more than 7.6% after beating earnings expectations and reaffirming growth in its cloud and AI segments. Meta wasn’t far behind, gaining over 4.2% as its advertising and engagement metrics outperformed. Tesla was the lone member of the Magnificent Seven in the red, closing slightly lower. Apple and Amazon were active in after-hours trading—Apple beat on earnings and approved a massive buyback, while Amazon slid due to light Q2 guidance despite a solid Q1 beat. Broadly, Big Tech saw a return to leadership as investors embraced stronger-than-expected results across the board.

Commodity and Cryptocurrency Updates

Crude oil climbed 1.34% to $58.99, nearing our longstanding $60 target. While oil may flirt with higher prices in the near term if the dollar weakens further, our outlook remains bearish over the longer term as interest rates rise. We still see $50 as a buy level in the weeks ahead. Gold fell sharply, down 2.15% to $3,248 as risk-on sentiment grew. Bitcoin rallied 2.11%, closing just above $96,400. We remain long-only in Bitcoin, preferring to buy between $77,000 and $83,000 and take profits above $85,000, while avoiding buys below $77,000 given the downside risk.

Treasury Yield Information

The 10-year Treasury yield rose 1.08% to 4.220%, a modest climb that still keeps yields below the key 4.5% threshold. Rising yields remain a concern for equity markets, with 5% and above signaling trouble. A move toward 5.2% would likely spark a major equity correction. For now, yields are climbing gradually, reflecting cautious optimism and market resilience in the face of mixed economic data.

Previous Day’s Forecast Analysis

Wednesday’s forecast called for a trading range of $545 to $562 with a bullish tilt, targeting $560 and $565 if SPY could hold above $550. Resistance was expected around $555 to $560, with support zones at $550, $548, and $545. The strategy highlighted long trades above $550, favoring profit-taking near resistance zones, while cautioning against breakdowns below $545, which could initiate a move toward $535. Volatility was expected to remain elevated with an emphasis on two-way trading.

Market Performance vs. Forecast

Thursday’s trading confirmed the accuracy of the prior day’s forecast. SPY opened at $547.57, held above the key $545–$550 support zone, and pushed toward the upper end of the projected range, closing at $558.47 after touching $564.07 intraday. The session respected both key support and resistance levels, with upward momentum carrying price near the $565 target zone. Traders who followed the model’s suggestion to go long above $550 likely captured significant gains, especially on dips toward support early in the session. The price action reaffirmed the reliability of our forecast in volatile environments.

Premarket Analysis Summary

In Thursday’s premarket analysis posted at 8:47 AM, SPY was trading at $560.69 with a bias level at $560. The forecast leaned bullish but urged caution due to elevated levels and the need for sustained buying volume to reach a stretch target of $570. If SPY failed to hold above the bias level, downside targets were set at $557, $553, and $548.50. The guidance called for early profit-taking and highlighted consolidation as the most likely scenario for the day.

Validation of the Analysis

Thursday’s market followed the premarket plan closely. SPY began the day near $560 but soon slipped slightly below the bias level, touching $557.86 before rebounding strongly to a high of $564.07. While the 562 target was easily reached, the stretch target of $570 proved elusive, reflecting the premarket warning about fragile momentum. The predicted support zones at $557 and $553 were honored, and the advised strategy of taking profits early proved ideal. The market’s consolidation into strength confirmed the premarket analysis as a valuable tool for navigating the day’s trades.

Looking Ahead

All eyes now turn to Friday’s Monthly Jobs Report, which could significantly sway markets, especially after this week’s GDP and labor data disappointments. A strong reading could fuel bullish sentiment and push SPY above key resistance, while a miss might trigger a sharp reversal. Traders should be prepared for increased volatility heading into the release and stay flexible in anticipation of potential directional shifts.

Market Sentiment and Key Levels

SPY closed at $558.47, extending the bullish trend and keeping buyers in control. Market sentiment remains positive but cautious, with resistance now looming at $560, $565, and $570. Support stands at $556, $552, and $548. A breakout above $560 could lead to a swift test of $565, while a move through $565 opens the door to $570 or even $575. However, failure to hold $556 or $552 may invite another test of $545. Momentum remains strong, but with economic risk ahead, the market could shift rapidly.

Expected Price Action

Our AI model projects a broad trading range of $549.75 to $571.50 for Friday—actionable intelligence that suggests volatility ahead of the Monthly Jobs Report. The market leans bullish, with upside targets at $565 and $570 if SPY clears $560 with strong volume. A breakout through $570 could squeeze shorts and trigger a move toward $575. On the flip side, if SPY fails to hold above $556 or $552, a decline toward $548 or $545 is likely. A failure below $545 sets the stage for a test of $535 and possibly lower. With such key macro data ahead, traders should avoid chasing momentum and instead look for failed breakouts or breakdowns at major levels.

Trading Strategy

Long trades are favored above $556, targeting $560 and $565. A breakout above $565 could bring $570 or even $575 into play. Short trades become viable below $552, with targets at $548.50, $545, and $540. If $545 fails, expect $535 to come into view. Volatility remains high with the VIX closing at 24.60, so use tight stops when trading near resistance and wider stops when entering on breakouts. Trade smaller ahead of the jobs report and stay nimble. Manage risk carefully and avoid overexposure until the market picks a clear direction.

Model’s Projected Range

The model’s maximum projected range for Friday is $549.75 to $571.50, with the Call side dominating, suggesting consolidation with perhaps some retracement of recent gains. As we said yesterday, after such a strong run, a day or two of consolidation is expected. Major firms continue to report Q1 earnings, and while Microsoft and Meta are being rewarded, Amazon is not. These heavyweight names have the power to push the market sharply in either direction. The projected range has widened for tomorrow due to the upcoming Monthly Jobs Report. As such, we recommend trading what you see in a market that is likely to consolidate into the report, then trend decisively in one direction afterward. We continue to expect the $545–$565 range to contain price action until a new catalyst breaks the zone. As long as this range holds, bulls retain the edge, with a potential parabolic move above the 200-day moving average that could trigger a short squeeze. The next upside targets are $565 and $570. A break below $545, however, could mark the beginning of a corrective move, with $535 as the next key support. A failure there would likely set off a deeper decline. We continue to favor two-way trading while viewing the current rally as a relief move within a broader bear market context. The market remains vulnerable to another leg lower, particularly as price nears the $565–$585 resistance zone. A retest or even a breach of recent lows becomes more probable if bulls lose momentum. Historically, declines of this nature often develop 4 to 16 weeks after an initial bottom. We strongly advise considering protective strategies or trimming long exposure as these resistance levels are tested. Key technical levels for Friday include: Resistance: $565, $570, $575. Support: $560, $558, $556, $552. The wall of resistance above $565 is formidable, but so is the support below $560 signaling a balanced market more likely to consolidate than break into a new zone. Friday’s Jobs Report could upend this dynamic quickly, especially in the premarket. Longer term, a close above $585 hands full control to the bulls, while a break below $545 could set up a retest of $535 and a failure there would likely trigger a gap-fill move toward $530. Tariffs, bond yields, and inflation remain the key macro factors shaping market behavior over the next 90 days, or until more clarity emerges from the White House. The VIX closed at 24.60, nearing the 23 level, which should provide additional support for equities. With SPY settling just above $557 today, bulls continue to gain traction, having pushed price above the upper boundary of the bear trend channel that’s been intact since the December highs. If price continues to hold above this line, a new bullish trend channel will likely emerge in the coming days. Momentum currently favors the bulls, but in such a volatile environment, we strongly recommend staying nimble and prepared for rapid sentiment shifts.

Market State Indicator (MSI) Forecast

Current Market State Overview:
The MSI is currently in a Bullish Trending Market State having rescaled into yesterday’s close to its current state. SPY closed above MSI resistance turned support and extended targets printed for much of the day session. The MSI range is wide, indicating a strong bull trend. A late day selloff however will likely cause the MSI to update tomorrow either in the premarket or after the Jobs Report. Overnight, the MSI stayed constant but printed extended targets on the prior day’s late session rally which saw SPY move to $560 by todays open. SPY moved to a high of $564.07 by 11 am with extended targets forecasting the rise. With no extended targets printing at the close, again, it’s likely the MSI adjusts sometime before Friday’s open. Currently MSI support is at $556.09 and lower at $552.48.
Key Levels and Market Movements:
On Wednesday, we noted: “If the bulls stay motivated, they’ll hold price above $550 and push toward $565.” We also stated that “a break above $560 could trigger a parabolic move.” Lastly, we highlighted that “in the $565–$585 range, it’s highly likely institutional players begin hedging their long positions, which could cause price to stall or reverse”. With this actionable intelligence in hand, and SPY opening above $560 and well above MSI support, we chose not to enter long. Our concern: limited remaining upside potential. Instead, we waited for our favorite failed breakout pattern to emerge as a short setup. SPY pushed to $564 while extended targets continued printing, keeping us on the sidelines. At 11:50, those extended targets finally stopped, but by then SPY had already pulled back to $559 making a short less appealing. So, once again, we waited for a retest of the day’s high or a fresh level to engage. One such level, $562, had been identified in our premarket report. As price approached it, we considered a short but lacking a strong pattern, we remained patient, waiting for a pattern to present. At 2:45 pm, SPY printed a less-than-perfect failed breakout. We waited a bit longer for extended targets to stop printing and entered short at 2:52 pm, right at our $562 premarket level. We were confident in a move to $560 as a first target, given the level had been tested multiple times and seemed ripe for another. SPY didn’t cooperate immediately, but with just 8 minutes left in the session (we always go flat at the close), SPY finally dropped hard. We took our first target at $560 then looked at $557 for our second. That target was hit quickly as well, so with the close imminent, we exited our final 30% of our position, wrapping up a one-and-done trade that took all day to develop but one that paid handsomely. We often state you only need one or two trades a day to build a lucrative trading career. Our approach trading level to level and leaning on failed patterns. While conservative, this method consistently delivers a high win rate, with small losses and outsized gains. We take almost no heat on our trades. This is the result of disciplined execution grounded in a solid plan, guided by the MSI and our model’s levels. The MSI reveals who’s in control, when control shifts, and where key actionable levels lie enabling precise entries and exits. When paired with our model’s levels, 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 capture profits with confidence. We strongly recommend integrating the MSI into your trading toolkit. When combined with a structured plan, it becomes a powerful engine for long-term performance.
Trading Strategy Based on MSI:
Friday brings the week’s headline event: the Monthly Jobs Report often as market-moving as an FOMC announcement. Don’t be surprised if SPY moves $10 or more premarket. Typically, the initial reaction is faded, so if you’re trading early, be cautious not to chase the first move. While earnings have been strong overall, Amazon’s results appear to have rattled sentiment. A test of the 200-day moving average, now just overhead, could prove difficult to clear. As a result, despite the MSI remaining in a wide bullish state, we expect some further overnight pullback followed by consolidation into the Jobs Report. After the release, expect trending action at least through the morning session. Barring a surprise from the jobs number, bulls still have the ball and will likely attempt to reclaim today’s highs. The market continues to trade in a balanced range between $545 and $565. It will likely take an external catalyst to break out of this zone. Should price move into the $565–$585 region, we anticipate institutional traders lightening up positions and employing protective strategies as summer approaches. “Sell in May and walk away” may be a relevant theme in 2025. For Friday: Bullish scenario: If bulls hold above $555, a push toward $570 is likely. Bearish scenario: Failure to hold $555 opens the door to a retest of $545, or even lower. Critical support: A breakdown below $545 could lead to $535. Below that, a gap fill toward $525 is possible. Overhead resistance: The 200-day MA at $572 is a key level. Long-term view: Bulls remain in control as long as price stays above $535, but any advance into the $565–$585 zone is vulnerable to stalling or reversal. Reclaiming control: Bulls won’t fully regain control until SPY reclaims $585. Expect solid two-way trading opportunities. Shorts are viable above $560, while longs become attractive below $555. Continue focusing on failed breakouts and breakdowns near these key levels. Avoid trading into extended targets or fighting the wide MSI range. As always, trade what’s in front of you. Lean on the MSI and stay nimble. The Premarket Report provides fresh data and AI-driven insights to guide your daily strategy. The MSI updates in real time, revealing intraday structure and momentum shifts to help you avoid stale narratives. Combined with our model levels highlighting high-probability targets and precise entry zones these tools keep you aligned with dominant market forces and protect against costly mistakes. If you're not already using the MSI and model levels, now is the time. Reach out to your rep as they’re game-changers in a market like this.

Dealer Positioning Analysis

Summary of Current Dealer Positioning:
Dealers are selling $561 to $580 and higher strike Calls while buying $559 to $560 Calls indicating the Dealers desire to participate in any rally on Friday above $559. The upside, however, also looks limited to $570 for Friday. To the downside Dealers are buying $558 to $515 and lower strike Puts in a 3:1 ratio to the Calls they are buying/selling, implying a slightly bearish posture for Friday. Dealer positioning has changed from neutral/slightly bullish to slightly bearish.
Looking Ahead to Next Friday:
Dealers are selling $559 to $600 and higher strike Calls while also selling $555 Puts implying the Dealers belief that price may pullback some but likely not fall beyond $555. Dealers believe the market peak for next week is $570. To the downside, Dealers are buying $558 to $490 and lower strike Puts in a 4:1 ratio to the Calls/Puts they’re buying/selling. This reflects a bearish outlook for next week. Dealers are heavily protected should $540 fail but are also open to prices reaching $570 next week. Dealer positioning has changed from slightly bearish to 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

SPY’s continuation above $564 and solid close confirm bullish momentum, but caution is warranted with Friday’s jobs report on deck. Long trades are preferred above $555 with targets at $560, $565, and $570. Should SPY push above $570, a move toward $575 is possible, particularly if economic data is favorable. Short trades may be taken below $552, targeting $548.50, $545, and $540 or above $565. Given the VIX at 24.60, elevated volatility persists, so keep position sizes small and stops tight around major levels. With a wide projected range and a key economic report approaching, be nimble and prepared to reverse if momentum shifts. Review Friday’s premarket report before 9 AM ET to account for any overnight shifts in bias or Dealer positioning.

Good luck and good trading!