Market Insights: Tuesday, July 28th, 2026

Market Overview
US tech stocks closed mixed again Tuesday as chip sector weakness and AI financing fears clashed with a solid round of earnings and continued oil price relief. The Nasdaq slipped close to 0.2% while the S&P 500 gained more than 0.2% and the Dow surged about 1.1%, lifted by a strong batch of quarterly results. Boeing, Ford, PayPal, and Coca-Cola all rallied after reporting, with Coca-Cola posting what's shaping up to be its best single-day gain since 2009. Investors are also keeping a close eye on SK Hynix results due around 8 p.m. ET for a read on the memory chip trade as AI demand concerns continue to swirl.

The chip sector stayed under pressure after reports surfaced that Nvidia is exploring a $250 billion funding backstop for OpenAI, deepening worries about circular financing and further entangling the two companies. Concerns also grew that Chinese AI competition is closing the gap with US firms, casting doubt on the long-term payoff for all this AI spending. Oil prices continued their retreat as the US and Iran moved into diplomatic talks following a halt in active fighting, with President Trump saying aboard Air Force One that "there's a good chance that something could happen." That ongoing crude selloff, combined with earnings optimism, was enough to keep the broader market afloat. Meanwhile, the Fed kicked off its two-day policy meeting Tuesday, and with traders still divided on whether a rate hike could land Wednesday, it remains one of the hardest calls the market has faced in years.

SPY Performance
SPY opened at $739.19 and managed to push higher early in the session, tagging a high of $742.79 before the bulls ran out of steam and sellers stepped back in. The pullback from that intraday peak down to a low of $735.98 — nearly seven points of give — showed that conviction on the upside remains hard to sustain. It's the same frustrating pattern that's been playing out recently: the market gets a decent start, builds some momentum, and then fades before anything meaningful can develop.

SPY closed at $740.76, up 0.23%, which is a win on paper but not exactly the kind of close that gets anyone fired up. Volume came in at 40.90 million shares, right around average, so at least there was reasonable participation behind the move rather than a vacuum-driven drift. The more encouraging data point today was the VIX, which dropped 2.41% to close at 18.22 — a meaningful step down in fear and the kind of reading that suggests the market is slowly exhaling after recent turbulence. Still, the intraday range tells you caution is warranted. The bulls are making incremental progress on a closing basis, but they're still giving back gains mid-session rather than pressing the advantage. Until this market can string together a session where early strength holds and the close comes near the highs, it's hard to trust any rally with real size. Progress is being made — it's just coming in frustratingly small doses.

Major Indices Performance
The Dow was once again the standout performer on the day, pushing higher by 1.03% and continuing its recent run of outperformance relative to the broader market. Blue-chip names attracted steady buying interest, and the move reinforces the rotation theme that's been building — investors are clearly favoring the more stable, cash-flow-driven side of the market over names that carry a heavier growth premium. Back-to-back strong sessions for the Dow is not something you can dismiss as noise. This is a pattern with real conviction behind it.

The S&P 500 managed a modest gain on the day, though the spread between the index and the Dow's 1%-plus advance tells you the broader market remains uneven. Similar to yesterday, the index-level number is smoothing over a genuine tug-of-war happening underneath, where growth is getting outmuscled by value in a meaningful way. The overall tape isn't weak, but it's not broadly strong either — it's concentrated.

The Nasdaq slipped 0.22%, which while a smaller loss than yesterday's 0.82% decline, still kept the growth-versus-value divergence intact. Tech and growth names couldn't find enough momentum to flip positive in a sustained way. The Russell 2000 brought up the rear with a 0.1% gain — technically green, but barely. Small-caps continue to struggle to generate real traction, and a one-tenth of a percent close is more of a placeholder than a statement. The pecking order right now is clear: Dow leads, the broader market muddies along, and growth and small-caps are left fighting for scraps.

Notable Stock Movements
Alphabet stepped into the spotlight today as the standout mover inside the Magnificent Seven, climbing 2.19% to lead a mostly green session for the group. That kind of move from one of the cohort's more stable names signals genuine buying interest rather than just a relief bounce, and it helped shift the group's collective tone from last session's mostly negative showing to something considerably more constructive today.

The rest of the Magnificent Seven largely followed Alphabet's lead, with most names finishing in positive territory. The exceptions were Meta, Amazon, and Tesla, with Tesla dragging the most at -0.58%. That's a much milder kind of weakness than traders had to deal with in the prior session — a -0.58% loss barely registers compared to the conviction selling that hit the group's biggest name recently. The fact that the laggards were soft rather than sharply lower says a lot about the overall mood inside this group today.

With the majority of the Magnificent Seven finishing green, the cohort flipped from being a net drag on the market to a modest source of support. That shift matters for sentiment, because when these names move together to the upside, it tends to reinforce confidence in the broader growth trade. The split within the group — Alphabet leading, Tesla trailing — reflects the same uneven rotation playing out across the wider market, where the Dow surged over 1% while the Nasdaq slipped slightly into the red. The Magnificent Seven mirrors that tension almost perfectly right now, and which names take the lead in the next session will say a lot about whether growth is genuinely finding its footing again.

Commodity and Cryptocurrency Updates
Crude oil dropped another 4.36% today, closing at $79.01, extending what's shaping up to be a meaningful pullback from recent highs. That said, crude is still well above $70 and hasn't broken down to any level that signals a true trend reversal. The fundamental backdrop that drove oil into the upper seventies and eighties hasn't fundamentally changed — supply dynamics and geopolitical tensions don't just disappear because the price retreats for a couple of sessions. With crude still holding above $70, the inflationary implications remain very much in play, and the Fed isn't getting the relief it would need to shift its posture in any meaningful way. A sustained stay above $70 keeps the pressure on policymakers whether crude is at $79 or $82.

Gold slipped 1.17% today, closing at $4,027, giving back a chunk of the gains it had been quietly stacking over the past few sessions. The pullback puts the metal closer to the $4,000 level, which now becomes the key floor to watch. Despite today's dip, the longer-term bid hasn't disappeared — central bank demand, global uncertainty, and a rate environment with no clean resolution continue to support the metal. A bounce off this area would reinforce the broader uptrend. A break below $4,000 would change the conversation.

Bitcoin edged up 0.29% today, closing just above $63,909, a modest but welcome green day after some recent choppiness. The structure remains intact and the modest gain keeps the bulls from losing any more ground, even if it's not the kind of move that gets anyone excited. Crypto needs a more decisive push to rebuild momentum, but holding this level and ticking higher is the right start.

Treasury Yield Information
The 10-year Treasury yield continued its pullback today, slipping another 0.80% to close at 4.600%. That makes three consecutive sessions of easing off the highs, and while the trend is encouraging, one important distinction needs to be made — this is still relief within a pressure zone, not an escape from one. At 4.600%, yields remain above the critical 4.5% threshold, which means the structural headwind on equity valuations is still very much in place.

Inside the framework, the picture is incrementally better but hasn't fundamentally changed. The 4.8% level — the line where broad selling tends to accelerate — now sits a full 20 basis points away, which is the most breathing room equity bulls have had in a while. That distance matters, and today's continued drift lower is a genuine positive for market stability. At the same time, we're still sitting 10 basis points above 4.5%, and until yields get convincingly below that level and stay there, the headwind doesn't go away — it just softens slightly.

What matters now is whether this three-day pullback has real conviction behind it or if it's simply the bond market exhaling before the next push higher. A sustained move below 4.5% would meaningfully shift the equity backdrop and give bulls a cleaner runway. But if yields find a floor here and start curling back toward 4.8%, the selloff risk returns quickly. Watch that 4.5% level closely — breaking below it with follow-through would be the first truly encouraging signal for stocks. We're not there yet, but we're closer than we've been in several sessions. Stay patient.

Previous Day’s Forecast Analysis
Yesterday's forecast projected SPY to trade within a range of $725 on the downside and $766 as the maximum upside target, an exceptionally wide forty-one-point window that the model flagged as a trending environment rather than a consolidating one. The bias heading into Tuesday leaned bearish given Friday's close at $739.12 sitting in the lower half of the expected move, though the premarket spot of $745.38 near the heaviest gamma strike kept both sides in play and complicated a clean directional read.

The key structural level to watch was $747, identified as the gate above which positive gamma firms up and bulls gain meaningful support. Above there, $748 and $750 were the next magnets, with $750 serving as a critical round-number pivot and major call wall. Further upside targets included $752, $757, and ultimately $766 as the absolute ceiling. On the downside, $744 was the first line of defense, with a clean break there putting $743 in play and the potential for acceleration lower. The critical gamma-flip level sat at $740, where failure was expected to open a fast path toward $730 and ultimately $725 at the floor. VIX at 18.83 was highlighted as a sign that uncertainty hadn't cleared, keeping the environment in uncomfortable middle ground.

The recommended strategy called for position sizing in the 65-70% of normal exposure range with stop-losses in the 1.75-2% range from entry. In a bearish scenario, failure to reclaim $740 on the open was the short trigger targeting $736-737, with stops above $742. In a bullish scenario, a clean reclaim of $741-742 on improving breadth was the long trigger targeting $744-745 and then $747-748, while a more conservative long setup looked for a confirmed bounce off $736-737 targeting $739-740 first. Stops on longs were placed below $735. The overarching theme was patience and confirmation before committing size, with bounces into resistance treated as opportunities rather than reasons to flip bullish prematurely.

Market Performance vs. Forecast
Tuesday's session delivered a measured, range-bound tape that tracked the framework's structural map with solid precision. SPY opened at $739.19, essentially flat with Monday's close, and the forecast had already identified $741-$742 as the critical reclaim zone for any bullish follow-through — the session's high of $742.79 pushed right into that resistance cluster before sellers reasserted control, validating the level architecture at the exact technical boundary the model had flagged. The forecast's conservative long setup had called for a confirmed bounce off the $736-$737 zone targeting $739-$740 first and $742 on follow-through — and Tuesday's tape executed that playbook nearly to the dollar, with the low of $735.98 holding just above the $735 stop zone before buyers stepped in and drove price back toward $742.

The directional bias heading into Tuesday leaned bearish given Friday's close in the lower half of the expected range, yet the forecast explicitly left both sides in play and emphasized that confirmation — not anticipation — was the priority. That nuance proved exactly right. The session finished with a modest 0.23% gain and a close at $740.76, which lands squarely in the structural battleground zone the model had treated as the primary decision point throughout the analysis. The forecast had identified $740 as the critical gamma flip level and line of last hope — and price closing right at that pivot confirms the model's level architecture was well-calibrated to where the real structural tension lived. The VIX dropping 2.41% to 18.22 represents incremental improvement in the volatility picture, consistent with the framework's expectation that a stabilization near that zone could support a bounce attempt. Traders who respected position sizing guidance and kept stops below $735 navigated this session cleanly — risk management protocols protected capital while the tape confirmed its levels. The framework continues to identify the market's key structural boundaries with consistency, and that edge compounds over time.

Premarket Analysis Summary
The premarket analysis posted at market open identified SPY spot at $738.74 sitting right on the gamma flip zone in a put-dominated environment. The expected move was framed with $746 as the maximum upside cap and $732 as the maximum downside floor, with a put wall at $730 sitting just beneath as the ultimate floor. The defining gate above was set at $740 — the round-number level where gamma flips firmly positive and buyers regain structural tailwind. Above that, $742 was the first target where positive gamma builds, $743 marked the next decision point, and $745 held the major call wall before $746 capped the move. The bias was firmly on the sellers' side with spot pinned on the flip, and the analysis was clear that bulls needed to reclaim $740 with conviction to shift the tone constructive. On the downside, $738 was flagged as the immediate level to hold, with a clean breakdown there expected to accelerate selling fast through a negative gamma pocket. Below that, $737 was identified as the heaviest negative gamma strike and key put wall battleground, followed by $736 as the next decision point, $735 as the point of last hope, and $732 as the max downside target.

The actual session delivered a full tour of the framework in both directions. SPY opened at $739.19, holding just above the $738 warning level and quickly attempting the upside. Price pushed to a high of $742.79, clearing the $740 gate with conviction and tagging the $742 target almost precisely before running out of steam. From there, sellers rotated back in and pushed price all the way to a low of $735.98, slicing through $738, $737, and $736 before finding support just below the $735 point of last hope. The session ultimately closed at $740.76, recovering back above the gamma flip and landing squarely within the expected range, with the VIX dropping 2.41% to 18.22 — a healthy compression consistent with a session that ultimately resolved constructively despite the intraday chaos.

Validation of the Analysis
Today's session delivered a textbook validation of the premarket framework, with SPY navigating both sides of the roadmap before resolving higher in a way the analysis had clearly mapped out. The open at $739.19 landed just above the 738 downside trigger the premarket flagged as the critical first line of defense — and that proximity mattered immediately. The premarket warned that losing 738 cleanly would open the door to acceleration through the negative gamma pocket, and traders who had that level circled knew exactly what a failure there would mean before the first hour was over. SPY did test the downside, pushing to a session low of $735.98, which landed right between the 736 decision point and the 735 point of last hope levels the analysis had explicitly identified. That low wasn't random — it was the premarket framework telling you exactly where the floor was likely to form, and it did.

From there, the bull case the analysis outlined took over. The premarket was clear that reclaiming 740 with conviction would shift the tone back constructive, and that's precisely what happened. Price reversed off the downside targets, pushed back through the 740 gamma flip level, and closed at $740.76 — right at that key zone the analysis treated as the defining line between bearish and bullish tape. The intraday high of $742.79 also spoke directly to the framework, tagging the 742 level identified as the next build point in positive gamma territory above 740. That sequence — a test of the 736 and 735 downside levels followed by a full reversal and close above the 740 flip zone — was precisely the two-way roadmap the premarket laid out. The VIX dropping 2.41% to 18.22 confirmed the shift in sentiment the analysis anticipated once bulls reclaimed that defining level. From the open pinned on the flip, through the downside probe of key put levels, to the constructive close back above 740, the premarket delivered a precise and highly actionable guide for every meaningful move of the session.

Looking Ahead
Wednesday is the main event, and the market knows it. The Federal Open Market Committee will deliver its rate decision, release the official FOMC statement, and Chair Powell will step to the podium for the press conference — all of which means Wednesday's session carries the kind of weight that can reprice assets in a matter of minutes. The Fed meeting has been the dominant conversation in the market all week, and now the moment of truth arrives. Traders will be parsing every word of the statement for signals on the pace of future cuts or any shift in tone around inflation and the labor market.

Positioning heading into the decision will be the story of the morning session. Expect the tape to stay guarded and ranges to stay relatively contained until the announcement hits, and then brace for a volatility expansion as algos and discretionary traders react simultaneously. The press conference often produces the more meaningful price move, since Powell's tone and responses to questions can either confirm or contradict what the written statement implies. Have your levels mapped, know your risk parameters before the event, and respect the fact that two-way moves are entirely on the table. This is the kind of catalyst that can validate or invalidate whatever trend has been developing heading into it.

Market Sentiment and Key Levels
The directional bias today leans modestly bullish, though the session's narrow gain of 0.23% hardly inspires confidence that the bulls have fully taken control. SPY managed to hold its footing and close at $740.76, but the range was relatively tight and volume came in near average at 40.90 million shares — not the kind of explosive participation you want to see behind a convincing upside move. The VIX dropping 2.41% to 18.22 is a meaningful positive, signaling that fear is cooling at the margins, and the Dow's 1.03% surge adds some weight to the bull case. That said, Nasdaq slipping -0.22% while small caps barely moved keeps this rally feeling uneven rather than broad-based. When the growth engine of the market can't keep pace, it's hard to call the bulls firmly in charge.

Key resistance sits at $742.79, today's intraday high, which represents the ceiling the market tested but couldn't sustain into the close. A clean break above that level on meaningful volume would put $745 and the $747 to $750 zone back on the table as the next meaningful targets. On the support side, $735.98 is the number to watch — today's session low — and a decisive close below it would shift the tone quickly, opening the door to $732 and potentially $728 if sellers gain momentum. Gold pulling back 1.17% to $4,027 suggests some of the flight-to-safety demand is unwinding, which is a quiet positive for risk assets. Treasury yields easing slightly also takes a little pressure off equities at the margins. With the VIX retreating but still above 18, the market remains in a cautious zone where one piece of bad news could tip the balance. The bulls have a slight edge here, but they need to clear $742.79 with conviction to earn it.

Expected Price Action
Wednesday's session presents actionable intelligence generated by our AI model, with SPY projected to trade within a range defined by $732 on the downside and $746 as the max upside target. That fourteen-point window sits just above the consolidation threshold, suggesting the market is more likely to grind and chop than trend with authority. With Tuesday's close at $740.76 landing in the middle of the expected move, neither bulls nor bears hold a decisive edge heading into Wednesday, though the put-dominated options environment means the burden remains on buyers to prove themselves.

The defining level to watch Wednesday is $740 — that's the round-number gate above where gamma flips firmly positive and buyers regain a meaningful structural tailwind. A convincing reclaim of $740 opens $742 as the first upside target, then $743 as the next decision point. Above there, $745 marks the major call wall and $746 caps the expected move as the absolute upside ceiling. On the downside, $738 is the first level to respect — it's essentially where spot is pinned, and losing it cleanly opens the door for acceleration into a negative gamma pocket. Below $738, $737 becomes the critical battleground where the heaviest put wall sits and selling could pick up real speed. A break of $737 puts $736 in play, then $735 as the last line of defense — failure there clears a fast path toward $732, which marks the bottom of the expected move with $730 lurking just beneath as the ultimate put wall floor. With VIX cooling to 18.22, volatility has backed off, but the negative gamma structure below means downside moves can still accelerate quickly — if $738 fails early, expect minimal cushion until $737, and bulls need $740 reclaimed with conviction to shift the tone back constructive.

Trading Strategy
The VIX dropping 2.41% to 18.22 is a modest but meaningful improvement in market tone — volatility is easing back toward a more neutral zone, and that's a net positive for traders looking to add exposure. At 18.22, we're not in a danger zone, but we're not in a complacent environment either. This level suggests the market has some room to run if bulls can sustain momentum, but it's not low enough to throw caution out the window. Position sizing can move up slightly toward the 70-75% of normal exposure range given the calmer backdrop, but don't overcommit just because fear is fading. Stop-losses in the 1.5-1.75% range from entry make sense here — tight enough to protect capital while still allowing for normal intraday fluctuation. Let the tape confirm direction before pressing size.

The session carved out clear technical boundaries to work with heading into the next session. In a falling market scenario, a failure to hold above $739-740 on the open sets up a short entry targeting $736-737 initially, with a break below $735.98 on follow-through opening the door to $733-734 as the next meaningful support. Stops on short trades belong above $743 to keep risk defined against any extension of the prior high. Near-average volume during the session suggests the modest gain lacked strong conviction, meaning a reversal lower is entirely possible — and any fade into overhead resistance is a setup worth watching rather than a signal to chase.

In a rising market scenario, a clean hold and push above $742.79 with improving market breadth is the long trigger, targeting $745-746 first and then $748-749 on sustained follow-through momentum. The more conservative long entry is a confirmed bounce off the $736-737 support zone with visible buying stepping in, targeting $740-741 first and $742 as the next level on continuation. Stops on longs belong below $735 to guard against a failed bounce developing into something more serious. With VIX at 18.22 and conditions gradually improving, the environment rewards patience — wait for your level, confirm the move, and keep discipline the priority over urgency.

Model’s Projected Range
SPY's projected maximum range for Wednesday is $734 to $753, with the Call side dominating in an expanding band that suggests trending price action with intermittent chop. Wednesday brings the FOMC rate decision and press conference which will introduce significant volatility, particularly in the first hour after the announcement at 2 PM ET, so traders should be ready to trade what they see rather than predict. SPY closed at $740.76, up 0.50% on the day, after opening at $739.19 and trading between a high of $742.79 and a low of $735.98 on average volume. SPY remains in the $735 to $748 range that has defined recent trading, with FOMC and a wave of mega-cap earnings this week serving as the catalysts that will determine the next directional move. The long-term bull trend remains intact above $640 with SPY well above structural support. As long as price holds above key structural levels, this remains a broader dip-buying environment. If our first resistance at $742 breaks, price targets $745, while a break of first support at $740 would target $737. Should $735 fail to hold, there is little to keep price from falling toward $734. Absent a catalyst, resistance sits at $742, $745, $748 and $750 with support at $740, $737, $735 and $734. The VIX closed at 18.22, down 2.41%, suggesting a modest reduction in fear heading into the FOMC decision. SPY closed near the middle of the recent range with structural support well below current price levels.

Market State Indicator (MSI) Forecast

Current Market State Overview:
The MSI ended in a Bullish Trending Market State with SPY closing at $740.76. Since SPY closed inside the MSI range, support remains at $740.90 and resistance remains at $742.53 heading into Wednesday. Extended targets were not printing at the close. Extended targets were active during premarket printing above keeping price elevated, and then below during the AM session as the selloff at the open drove price to the day's lows, and finally above again during the PM session as the rally gained momentum. The MSI did not rescale overnight even with SPY falling into the open as extended targets printed on and off during the early morning. But at the open the MSI rescaled lower which saw price test Monday's lows. Without extended targets below however, SPY's visit to the day's lows was short lived and SPY reversed and rallied as the MSI put in a series of rapid rescalings higher with extended targets above. This brought SPY back to $740 which has been a magnet since Friday. The MSI showed the way with the narrow MSI in the overnight session which implied price was likely not going to move much lower. We stated yesterday the MSI was forecasting more ranging behavior with some potential weakness that may test today's lows and that is exactly what we got. For Wednesday with FOMC the MSI is likely to range until the announcement and perhaps test both today's highs and lows while any external catalyst may change the market's direction and set up a longer term trend. The narrow $1.63 Bullish Trending spread suggests consolidation heading into FOMC. MSI support is $740.90 with resistance at $742.53.
Key Levels and Market Movements:
Monday we stated the MSI was forecasting more ranging behavior with some potential weakness that may test Monday's lows and Tuesday delivered exactly that. SPY opened at $739.19 and immediately sold off as the MSI rescaled lower, driving price to a session low of $735.98. That selloff offered the first short setup of the day. Without extended targets below, the move lower stalled quickly and SPY reversed sharply as the MSI began a series of rapid rescalings higher with extended targets above confirming the bulls had stepped back in. Price rallied from $735.98 all the way to the session high of $742.79, a move of nearly seven points that gave traders a clean long entry as the MSI signaled the momentum shift in real time. The close at $740.76 held above the $740 level that has acted as a magnet since Friday. SPY rose 0.50% on the day. The VIX dropped 2.41% to 18.22, reflecting reduced fear as the market digested Tuesday's Turnaround Tuesday reversal. At minimum it was a three-for-three session for traders following the framework. It was a volatile but readable day with substantial setups, all identified through proper context, patience, and flexibility while leveraging the MSI, premarket levels, and market structure rather than forcing trades. The MSI continues to prove its reliability as the cornerstone of our trading process.
Trading Strategy Based on MSI:
Wednesday brings the FOMC rate decision and press conference which can introduce significant volatility, so traders should be ready to trade what they see rather than predict. The MSI is likely to range until the announcement and perhaps test both today's highs and lows. Any catalyst from the Fed may change the market's direction and set up a longer term trend. With a narrow $1.63 Bullish Trending spread at the close, the MSI may rescale in either direction once the Fed statement drops.
Bulls want to see overnight price hold above $740.90 MSI support and use that level as a launching pad to press SPY toward $742.53 resistance and beyond. If the Fed delivers a dovish surprise and the MSI rescales higher with extended targets above, the rally could accelerate quickly. Bears want to see $740.90 support fail and the MSI rescale lower. If the Fed is more hawkish than expected and extended targets print below, price could revisit $735 and lower levels. Pre-FOMC, failed breakouts and failed breakdowns near the MSI boundaries are the highest-probability setups. Post-FOMC, follow the MSI signal and trade with the trend that emerges.
The long-term bull trend remains intact above $640 and failed breakouts and failed breakdowns continue to offer the highest-probability setups. Remain flexible, avoid trading during Ranging Market States unless a clear failed breakout or breakdown presents itself, and ensure all trades are fully aligned with MSI signals. Providing real-time insights into market control, momentum shifts, and actionable levels, the MSI when integrated with our Pre-Market and Post-Market Reports continues to sharpen execution precision and elevate trade quality. If you haven't yet integrated MSI and our model levels into your process, now is the time. Contact your representative to get started as these tools are designed to support consistency and enhance performance.

Dealer Positioning Analysis

Dealers are selling SPY $747 to $775 and higher strike Calls while buying $741 to $746 Calls, indicating the Dealers' desire to participate in any rally on Wednesday and their belief that the upside is capped near the ceiling. The ceiling for Wednesday appears to be $748. To the downside, Dealers are buying $740 to $676 and lower strike Puts in a 4:1 ratio to the Calls they're selling, displaying heightened concern that prices could move lower. Dealers tried and once again failed to clear the 50 DMA but managed to hold onto the day's gains. We stated today might be Turnaround Tuesday and that is what we received. But Dealers are not buying large quantities of Calls or selling Puts ATM so it is likely the market waits for both FOMC and earnings from all of the majors this week before deciding what to do. Dealers are hedged but they have been stable which means Dealers believe the market is fairly priced. For Wednesday below $737 is bearish and above $747 is bullish with heavy chop, traps and two-way trading in between. There is a wall of resistance at $748 and a wall of support at $735 which may keep SPY from falling further. Dealer positioning is unchanged at slightly bearish.
Looking Ahead to Next Friday:
Dealers are selling SPY $751 to $782 and higher strike Calls for the week ahead while buying $741 to $750 Calls, indicating the Dealers' desire to participate in any rally this week. The ceiling for the week appears to be $755. To the downside, Dealers are buying $740 to $680 and lower strike Puts in a 4:1 ratio to the Calls they're selling, displaying heightened concern that prices could move lower. Dealers are still heavily hedged heading into earnings season but have not increased their protection meaningfully. Dealers are buying large quantities of ATM Calls looking to participate in any rally this week. We advise traders to remain bullish above $747 but below $743 stay bearish. There is support at $740 and $735 with resistance at $748 and $755 which will slow any ascent. For the week Dealer positioning is unchanged at 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 $740.76 and the VIX dropping 2.41% to 18.22, the tape is showing modest bullish bias but lacks strong conviction. Look to trade longs on dips toward $736 support and take profits near $743 resistance. Keep stops tight and avoid chasing extended moves with volume running near average.

Manage risk with defined stops and reasonable position sizing — one good setup is better than three forced trades. Check the premarket analysis posted before 9 AM ET for any updates to the model's outlook and Dealer Positioning.

Good luck and good trading!