Market Insights: Monday, June 9th, 2025
Market Sentiment Recap for Monday, June 9th, 2025
Market Overview
U.S. stocks finished mostly higher Monday as optimism around renewed U.S.-China trade talks helped keep risk appetite alive. Investors welcomed signs of progress after high-level discussions in London between American and Chinese officials ended on a positive note, with more talks scheduled for Tuesday. The S&P 500 inched up 0.1%, now hovering just 2.3% below its all-time high, while the Nasdaq added 0.3% and the Dow closed unchanged. Confidence got a boost after President Trump remarked, “We are doing well with China,” and described early reports from the talks as “good.” These comments followed a recent phone call with President Xi, which helped reset expectations after tensions escalated last month. Market participants remain focused on the impact of tariffs, with fears that continued trade friction could weigh on global growth. However, for now, investors seem to be leaning into the potential for progress, especially after last week’s encouraging jobs data alleviated some concerns of a policy-induced recession. On the corporate front, Apple made waves at its annual developer conference, unveiling a new “Liquid Glass” interface designed to improve responsiveness across its hardware ecosystem. Meanwhile, Bitcoin extended its gains, climbing above $108,000, reflecting a broader appetite for risk.
SPY Performance
SPY ended Monday with a modest gain of 0.08%, closing at $599.64 after trading in a tight range between $598.49 and $601.25. The session began at $599.58, and despite briefly crossing above the $601 mark, the ETF failed to sustain its advance and settled just shy of the key $600 psychological level. Volume came in below average at 49.32 million shares, reflecting a cautious tone among investors ahead of midweek inflation data. While momentum remains intact, Monday’s price action indicated some fatigue after last week’s strong rally, with resistance at $600 continuing to cap gains.
Major Indices Performance
The Russell 2000 led gains Monday with a 0.59% rise, signaling strength in small caps. The Nasdaq followed with a 0.31% gain, driven by advances in key tech names. The S&P 500 posted a modest 0.1% uptick, while the Dow Jones Industrial Average was flat for the day. Market breadth was mixed, as investors awaited further clarity on trade developments and the upcoming inflation data slate. Optimism around the U.S.-China dialogue and easing political noise supported equities broadly, while defensive sectors lagged slightly as traders favored cyclical exposure.
Notable Stock Movements
The Magnificent Seven delivered mixed results on Monday. Tesla rebounded sharply, jumping more than 4% to lead the group higher after reversing early losses. Alphabet, Amazon, Nvidia, and Microsoft also posted gains, contributing to the Nasdaq’s outperformance. On the flip side, Netflix, Apple, and Meta declined, highlighting sector rotation within the group. The performance divergence suggests a market still willing to favor individual winners while remaining cautious on richly valued names amid tightening policy conditions.
Commodity and Cryptocurrency Updates
Crude oil advanced 1.18% to close at $65.34 as short-term dollar weakness temporarily buoyed energy markets. However, our model continues to project a move lower, targeting $60 and potentially $50, especially if interest rates resume their upward path. Gold was virtually flat, gaining 0.09% to settle at $3,349 as risk appetite returned and demand for safe havens eased slightly. Bitcoin rose 2.30%, closing above $105,800 and continuing its march higher after reclaiming key technical support. We maintain our long bias between $83,000 and $77,000 but advise against initiating new positions below $77,000 due to downside risk.
Treasury Yield Information
The 10-year Treasury yield dipped 0.73% to 4.481%, backing away from the 4.5% danger zone. This small retreat offered equities a temporary reprieve, as yields above 4.5% often begin to weigh on risk assets. Nonetheless, with inflation data due midweek, the bond market remains a critical factor. A fresh surge in yields above 4.8% would raise alarm bells for equities and could trigger broad-based selling, particularly in high-multiple sectors.
Previous Day’s Forecast Analysis
Monday’s forecast outlined a narrow expected range between $595 and $603 with a neutral to slightly bullish bias, highlighting the importance of holding above the $595 level. The strategy emphasized long trades above $595 targeting $600 and $603, while also cautioning that a break below $595 could signal downside toward $590 and $585. With no major catalysts on the schedule, traders were advised to expect a slow drift higher rather than a directional breakout, and to stay nimble around key resistance zones.
Market Performance vs. Forecast
SPY’s actual performance on Monday closely mirrored the forecast. The ETF opened at $599.58 and climbed to a high of $601.25, brushing up against resistance before fading slightly to close at $599.64. The projected range of $595 to $603 held firm, and the anticipated test of $600 played out as expected. SPY never breached the $595 level, confirming support and validating the long bias for the session. While price failed to sustain a breakout above resistance, the slow upward drift was consistent with the day’s projected tone. The restrained trading volume also matched expectations for a cautious session ahead of major data releases, offering traders clear setups around key levels.
Premarket Analysis Summary
In Monday’s premarket analysis posted at 7:53 AM, SPY was trading near $599.95 with the bias level set at $599. The analysis highlighted a slightly bullish tone, expecting upside continuation toward $601, $603, and possibly $605, provided SPY held above the bias level. A rejection at upper targets was expected to trigger a retreat to $598 or even $594. The setup suggested a “grind higher until momentum fades” scenario, urging traders to favor long entries near support and to lock in gains quickly.
Validation of the Analysis
Monday’s session validated the premarket blueprint with precision. SPY respected the $599 bias level, never falling below the $598.49 intraday low. The ETF tagged the first upside target at $601.25 but failed to advance further, echoing the forecast’s warning about a potential stall. Long entries near support would have been profitable, especially with gains taken at the initial $601 target. The anticipated fade from resistance played out, as SPY drifted lower in the afternoon to settle just below the $600 mark. The analysis once again served as a dependable roadmap, helping traders identify high-probability setups and exit points.
Looking Ahead
Traders now turn their focus to Wednesday’s Core CPI report, which is expected to provide critical insight into the Fed’s inflation battle. Thursday brings Core PPI and jobless claims, followed by University of Michigan sentiment and inflation expectations on Friday. These releases could inject volatility into what’s been a methodical market grind. With SPY hovering near key resistance, the inflation prints will likely determine whether the market breaks higher toward new highs or retraces back into its recent range.
Market Sentiment and Key Levels
SPY closed Monday at $599.64, remaining just under the stubborn $600 resistance level. Market sentiment is cautiously bullish, supported by softening geopolitical tensions and improving trade rhetoric. The bulls maintain control as long as SPY holds above $595. Key resistance remains at $601, $603, and $605, while support is building at $594, $591, and $590. A close above $601 could invite a push to $605, but failure to clear this zone may trigger another dip toward the lower $590s. Traders should monitor these levels closely, especially with critical inflation data looming midweek.
Expected Price Action
Our AI model projects an expected range between $596 and $603 for Tuesday, signaling room for higher prices following Monday’s tight range. The model holds a neutral stance with a slightly bullish tilt, supported by continued Call dominance in Dealer Positioning. If SPY holds above $595, upside targets at $603 and $605 come into play. A breakout above $601 could accelerate gains, but resistance thickens significantly through $605. Conversely, if SPY breaks below $595, a drop to $590 or $585 becomes likely. This is actionable intelligence: bulls remain in control above $595, but momentum may fade without a catalyst. Watch for inflation data later this week to tip the scales.
Trading Strategy
With the VIX ticking up 2.15% to 17.16, market volatility is beginning to stir. Long trades remain favored above $595, with upside targets at $601, $603, and $605. Consider tightening stops as SPY approaches these resistance levels. Short trades may be initiated on a breakdown below $595 with targets at $590 and $585, or on failed breakouts near $603 or higher. Avoid initiating shorts unless weakness is confirmed and maintain tight risk parameters in light of upcoming economic releases. Traders should size modestly and remain flexible, especially as inflation data this week could spark larger moves.
Model’s Projected Range
The model projects a maximum expected range for SPY on Tuesday is $594.75 and $606.25. The Call side continues to dominate within a stable band, suggesting that price action may continue to be choppy on Tuesday. Once again, SPY tested the $600 level and was rejected, closing essentially unchanged. Fresh developments in Los Angeles and ongoing tensions between former President Trump and Elon Musk appear to be influencing market sentiment in the absence of a major catalyst. Until such a catalyst emerges, traders should stay alert to breaking news that could shift the current dynamic. Despite the rejection at $600, the bullish narrative remains intact as long as SPY holds above $585. Momentum is slowing, suggesting a potential flagging pattern to consolidate before a breakout attempt toward $605. Our model remains neutral, signaling a slow, grinding advance barring any material change. A close below $585 would shift the outlook more decisively. Key resistance now stands at $601, $603, and $605. Support is found at $594, $591, and $590. SPY ended the day at the lower edge of a steep, uncorrected bull channel that began in April. The current pace of ascent looks unsustainable, and further weakness could force a redraw of the trend channel or mark the end of the rally altogether. Above $601, resistance thickens, especially into the $605 area, which may cap further upside in the near term. On the downside, support is weakening below $591. Without a fresh catalyst, SPY is likely to remain confined within the broader $575–$595 range that has contained most price action since May 13. If SPY holds above $595 on Tuesday, a move toward $603 and potentially $605 becomes more likely. Conversely, a break below $595 could open the door for a pullback toward $590 and possibly $585, both key levels for preserving the current bullish structure. Monday's light trading volume suggests a “wait and see” stance among market participants. Since April, market direction has been shaped by macroeconomic indicators, bond yields, inflation data, tariff news, and fiscal policy updates, a trend likely to persist in the absence of a major policy shift. Meanwhile, the VIX rose 2.15% to 17.16, still well below the key 23 level that often marks a transition to risk-off behavior. However, the uptick may reflect growing investor unease, raising the potential for price instability if negative surprises arise. Given the ongoing uncertainty, traders are advised to remain nimble and responsive to data releases and headline risk as the week unfolds.
Market State Indicator (MSI) Forecast
Current Market State Overview:
The MSI is currently in a wide Bullish Trending Market State with SPY closing toward the lower end of the range, above MSI support. Extended targets printed infrequently today which did support the slight move higher. Overnight, the MSI rescaled higher which contained price until the afternoon session. By 1 pm, the MSI began a series of rescalings higher with the occasional extended target which acted as a ceiling to the slow drift up. By 3 pm extended targets had stopped printing and SPY pulled back from the $600 level to end the day virtually unchanged. This suggests potential follow-through on Tuesday with SPY possibly holding above $600 and targeting $603 or higher. Currently MSI support stands at $598.93 with resistance at $601.22.
Key Levels and Market Movements:
On Friday, we noted: “Next week begins quietly, with little expected to move the market on Monday.” We also stated: “Upward momentum remains intact, and dips continue to be bought. As long as SPY holds above $595 on Monday, the upside potential extends to $605.” Finally, we reiterated: “We continue to favor long setups.” With this actionable guidance in mind, we went long after the open as SPY approached MSI support at $598.50. Despite a less-than-perfect failed breakdown, the setup aligned with our plan, and we targeted MSI resistance at $600.40 as our first objective. This level was reached by 10:30 a.m., after which we set our sights on T2 at the premarket level of $601. SPY chopped around for a while, with MSI containing price until 12:45 p.m., when the MSI rescaled higher and printed a sole extended target. We reached T2 and moved our stop to breakeven. MSI would rescale higher two more times, but price action showed reluctance to drift much beyond $601. After a triple top at that level and no further extended targets, we opted to reverse short, eyeing a move to $599. We didn’t love the trade and treated it more as a scalp than a high-conviction setup. Fortunately, into the close, SPY dropped to $599.50, allowing us to exit the full position with a $1.50 gain. A solid start to the week: two-for-two in a choppy session, driven by a clear, structured plan, disciplined execution, and the strategic application of the MSI to identify control, timing, and actionable levels. Integrated into our broader trading framework and model levels, MSI continues to prove indispensable for consistency and performance.
Trading Strategy Based on MSI:
There is little expected to move the market on Tuesday. The most significant potential catalysts remain developments from the White House, the LA riots, and ongoing China tariff discussions. Should any surprises emerge, the best approach is to stay nimble and trade the market in front of you. In the absence of a major catalyst, SPY is likely to drift around current levels, consolidating and potentially flagging slightly lower as it builds energy for a possible move toward all-time highs. Upward momentum remains intact, and dips continue to be bought. As long as SPY holds above $595 on Tuesday, the upside potential extends to $605. A break below $595, however, could send SPY down toward $585. Failure to hold that level may trigger a deeper pullback toward $580 or lower marking a critical inflection point that could shift control to the bears and bring the $575–$595 range, where institutions have been actively hedged, back into focus. Absent a breakdown, the path of least resistance remains higher. A sustained move above $600 could pave the way to new all-time highs. We continue to favor long setups, with key support down to $585. Tactical shorts may be considered above $602, but only if a breakout attempt fails and the MSI begins to weaken. As long as SPY remains above $585, long positions remain favorable. A sustained move below this level could reintroduce bearish pressure. Failed breakdowns continue to present high-quality long opportunities. Stay alert and responsive as these setups unfold. Avoid engaging during Ranging Market States, and always align your strategy with the MSI. The MSI offers real-time insights into market control, momentum shifts, and actionable levels. When used in conjunction with our Pre-Market and Post-Market Reports, it enhances execution precision and improves trade quality. If you haven’t yet integrated the MSI and model levels into your trading process, now is the time. Contact your representative to get started as these tools can significantly improve both consistency and performance.
Dealer Positioning Analysis
Summary of Current Dealer Positioning:
Dealers are selling SPY $600 to $610 and higher strike Calls implying the belief that the market may continue to move higher on Tuesday. The peak from this positioning appears to be $603. To the downside, Dealers are buying $599 to $550 and lower strike Puts in a 2:1 ratio to the Calls they’re selling. Dealer positioning is unchanged from neutral to neutral for Tuesday. Dealers are positioned to gain from prices moving slightly higher or lower on Tuesday.
Looking Ahead to Friday:
Dealers are selling $601 to $620 and higher strike Calls while buying small quantities of $600 strike Calls, implying the belief that the market may continue to drift up this week. The likely ceiling for the week is $605 but clearly Dealers are positioned for the rally to continue. To the downside, Dealers are buying $599 to $505 and lower strike Puts in a 3:1 ratio to the Calls they’re selling, reflecting a slightly bearish outlook for the week. Dealer positioning is unchanged from slightly bearish to slightly bearish. Dealer positioning hasn’t changed materially in several days which once again further reinforces a continuation of the bull/neutral trend. 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 continues to hold just below major resistance at $600, with support forming near $595 and $590. Traders should continue to favor long trades above $595, targeting $603 and $605 if momentum holds. Short trades can be considered below $595, with key downside levels at $590 and $585. If a breakout fails near $602, a tactical short could also be viable. With the VIX at 17.16, volatility is slightly elevated but still tame. Risk management is key. Size trades appropriately and use disciplined stops. Be sure to review the premarket analysis posted before 9 AM ET to account for any changes in the model’s outlook and in Dealer Positioning.
Good luck and good trading!
