Market Insights: Monday, September 22nd, 2025

Market Overview

US stocks extended their winning streak Monday, logging a third consecutive day of record highs as enthusiasm around Big Tech and artificial intelligence continued to dominate sentiment. The Nasdaq led gains with a 0.70% advance, followed by the S&P 500 up 0.46%, while the Dow added a more modest 0.14%. The rally was led by Nvidia, which surged after announcing a landmark $100 billion investment partnership with OpenAI. Oracle also moved higher on news it would join a White House-endorsed consortium poised to take over TikTok’s US operations.

The Nvidia-OpenAI deal marked a major escalation in the AI arms race, with investors viewing the partnership as a bold move to consolidate Nvidia’s leadership in advanced computing. Nvidia closed at a new record high, helping power the Nasdaq’s rise. Apple led the Magnificent Seven with a 4.31% gain as buyers rotated into names showing strong recent demand. Tesla and Netflix joined Nvidia in the green, while other mega caps saw modest declines. Meanwhile, gold surged to a new all-time high above $3,750 as traders priced in two more rate cuts by the Fed before year-end. Bitcoin, however, fell sharply, shedding nearly 3% after over $1.5 billion in long positions were liquidated.

Markets are now turning their attention to this week’s macro calendar, with Friday’s Personal Consumption Expenditures (PCE) report taking center stage. A softer inflation print would likely reinforce expectations for an October rate cut. Investors are also monitoring a wave of Fed speakers, including Chair Powell and Trump-backed Fed governor Stephen Miran, who on Monday said rates should be 200 basis points lower. Traders are also watching the fallout from the Trump administration’s decision to impose a $100,000 fee on H1-B visa sponsorships, with companies like Microsoft and Goldman Sachs warning employees of potential disruptions.

SPY Performance

SPY gained 0.46% to close at $666.78, marking yet another all-time high. The ETF opened at $662.22 and ranged tightly between $662.17 and $667.29 before settling just below the high of the day. Volume came in at 63.48 million shares, roughly in line with average levels. The modest session confirmed bullish continuation, with SPY once again reclaiming key levels and building on the previous week’s momentum. Dip buying remained the dominant theme, and the rally continues to be reinforced by strong macro positioning and demand from institutional participants.

Major Indices Performance

The Nasdaq climbed 0.70%, outperforming on the back of Nvidia’s rally and tech sector strength. The S&P 500 rose 0.46%, while the Dow inched up 0.14%, marking its third consecutive record close. The Russell 2000 bounced 0.64%, recovering from Friday’s pullback. All four indices logged fresh record highs, underscoring the strength and breadth of the current bull run. As tech leadership remains intact and macro conditions supportive, equity markets continue to show resilience across the board.

Notable Stock Movements

The Magnificent Seven delivered a mixed session Monday, with Nvidia, Apple, Tesla, and Netflix leading the way. Apple rallied over 4% amid strong demand signals and increased fund flows. Nvidia touched a new high after unveiling its massive OpenAI partnership. Tesla also gained ground as investors looked ahead to product announcements and the company's autonomous driving ambitions. Meta, Alphabet, Amazon, and Microsoft ended modestly lower. In the broader market, Oracle surged alongside Nvidia, while gold stocks rallied on the back of record-high bullion prices.

Commodity and Cryptocurrency Updates

Crude oil slipped 0.16% to settle at $62.30, continuing its slow grind toward the model’s long-held $60 target. Gold jumped 2.02% to $3,780, marking a new all-time high and building on recent strength as expectations for further rate cuts firmed. Bitcoin declined 2.82% to close just above $112,000 after a wave of long liquidations. While commodities remain mixed, rising gold and falling crypto suggest traders are positioning more defensively ahead of key inflation data later in the week.

Treasury Yield Information

The 10-year Treasury yield rose 0.24% to finish at 4.150%, moving slightly higher but still below the key 4.5% threshold for equity pressure. The market remains on watch for any push toward 4.8%, which could weigh on risk assets. A move above 5% would likely trigger a significant correction, and above 5.2% could spark a 20% or greater drawdown. For now, yields remain contained, and with gold rallying and PCE due Friday, markets are pricing in a dovish Fed tone through year-end.

Previous Day’s Forecast Analysis

Friday’s forecast projected SPY would trade between $657.75 and $667.25, with bullish continuation expected above $663. Resistance levels were marked at $665 and $667, while support was outlined at $658, $655, and $650. The forecast also noted the potential for early strength driven by AI momentum and the likelihood of quiet digestion unless geopolitical headlines disrupted flows.

Market Performance vs. Forecast

Monday’s action aligned perfectly with the model’s projected range. SPY opened at $662.22, held support above $662.17, and rallied to a high of $667.29 before closing at $666.78. Resistance at $665 and $667 acted as key inflection points, with price stalling just below the upper bound. The session unfolded with low volatility and steady upward movement, reflecting the continued control by bulls and reinforcing the model’s directional accuracy.

Premarket Analysis Summary

Monday’s premarket notes, published at 7:27 AM, set the bias level at $663 and listed targets above at $662.35, $663, $664.85, and $667.35. Support was noted at $659.85 and $657, with the model calling for upside follow-through above $663 and consolidation if that level was not reclaimed early. The roadmap highlighted $664.84 as a likely stalling point if the rally continued, and any dip to $659.85 was viewed as a buying opportunity barring a breakdown below $657.

Validation of the Analysis

The premarket roadmap played out with near-perfect precision. SPY opened just below the bias level at $662.22, reclaimed $663 early, and proceeded to rally toward the $667.35 target, peaking at $667.29. The model’s projected stalling point near $664.84 was temporarily respected mid-session before buyers resumed control. Dips to $662 were quickly bought, and volume remained average as buyers continued to defend key levels. The premarket analysis helped traders stay positioned long with confidence.

Looking Ahead

Tuesday brings flash PMI data, but markets are likely to continue focusing on Friday’s PCE release as the primary catalyst. With no other major news, price action may become more two-sided, especially as SPY approaches round-number resistance levels near $670. Traders will be monitoring Nvidia, Apple, and gold for signs of exhaustion or continuation. The bull trend remains in full effect, but euphoria may begin to fade as key macro data looms.

Market Sentiment and Key Levels

SPY closed at $666.78, holding well above the breakout level of $660 and continuing to establish new highs. Key support now stands at $665, $663, $661, and $657. Resistance sits overhead at $667, $669, $670, and $674. Bulls remain firmly in control above $657, and any dip into that level is likely to be defended. Only a break below $640 would trigger a broader reversal, which remains unlikely barring a macro shock.

Expected Price Action

Our AI model projects SPY to trade between $663 and $671 on Tuesday, with a slight upward bias unless $663 breaks early. Support lies at $665, $663, $661, and $657, while resistance is layered at $667, $669, $670, and $674. Buyers continue to support every dip, but caution is warranted as volume thins and headline risk increases. The recent strength in gold and weakness in crypto suggest growing hedging behavior, even amid record equity closes.

Trading Strategy

Long setups are favored above $663, with upside targets at $667, $670, and $674. Short trades may be taken on failed breakouts or weakness below $661. If $657 fails, downside momentum could accelerate toward $655 or $650. Until then, the trend remains firmly bullish. Caution is warranted with overnight exposure, and quick profit taking is encouraged. The VIX rose 4.21% to 16.10, signaling rising hedging activity. A move above 23 would likely mark a broader shift, but for now, bulls maintain the upper hand.

Model’s Projected Range

SPY’s projected range for Tuesday sits between $663 and $671, with the Call side dominating in a narrowing band that suggests choppy price action with intermittent trending periods. PMI and Powell speaking on Tuesday could move the market. Absent an external catalyst the bull trend is likely to continue to push SPY higher given another day of new all-time closing highs, following through on Friday’s rally. Weakness continues to be bought, with SPY now closing above the breakout confirmation level of $660 at $666.84. As a result, prices are likely to continue moving higher into the fourth quarter. Overnight, the market fell to $661.50 but was quickly bought, and by the open buyers stepped in again, pushing prices straight up with little pause. This type of euphoria will not last forever, but until weakness emerges, longs remain the only trade worth considering. Volume was average, and with SPY well above the critical $645 threshold and every dip being bought, the bulls remain in complete control of the broader narrative. Overnight, the bulls will look to defend $663, but for the bears to participate meaningfully, $657 must fail. A break there opens the door to $655, while a move below that would bring $650 into play. Until SPY falls to $640 or lower, however, the majority of bears remain sidelined. Our base case for a 10 to 15 percent pullback this year continues to weaken but is still on the table. We continue to view any weakness as a buying opportunity and recommend buying every dip above $657. For Tuesday, resistance sits at $667, $669, $670, and $674, with support at $665, $663, $661, and $657. Since reclaiming $585, SPY has held a steady uptrend fueled by dip buyers. Today Mag stocks were mixed, but Nvidia and Apple ripped higher, further supporting new highs. Until consistent weakness emerges in these leaders, or ETH closes below $4300, the market is likely to continue higher. With ETH dipping below this level today, we would watch this carefully as a potential canary in the coal mine warning of a potential pullback in the equities market. While not directly correlated, there is enough correlation to use this as a warning sign of what may follow. As such we continue to favor quick profit taking and caution with overnight holds. The VIX rose 4.21 percent to 16.10, and while contango in VXX futures has indicated further declines in volatility, the futures market is now more balanced with spot, which suggests volatility may hold near this level or move higher. If you have not added protection to your long book, now is the time. VIX below 23 supports the bullish case, but a breakout above it could finally spark the long-anticipated pullback. SPY closed firmly within a redrawn bull trend channel from the April lows, as the model continues to see higher odds of a continuation of the bull trend than a pending selloff.

Market State Indicator (MSI) Forecast

Current Market State Overview:
The MSI ended the day in a Bullish Trending Market State, with SPY closing well above MSI resistance turned support. Extended targets printed virtually the entire session and into the close. The MSI rescaled lower overnight to a narrow bearish state with extended targets off and on. But the range was quite narrow and by the open, the MSI had rescaled to a ranging state which led to its current narrow, bullish state. While the narrow range gave us reason to pause, extended targets told us the herd was participating in the day’s rally and as such, SPY went virtually straight up to new all-time closing highs. For Tuesday the MSI is implying a weak bull trend but one which is likely to continue to print new highs on Tuesday. With a narrow MSI, we expect more chop and two-way trading. MSI support is $664.27 and lower at $663.60.
Key Levels and Market Movements:
On Friday we wrote, “we expect two-way trading that continues to favor the long side. As such, we will still buy dips,” and noted, “The bulls want to defend $660, with SPY holding no lower than $658 overnight. Either dip should be treated as a buying opportunity,” while also stating, “it remains likely we continue to see new all-time highs.” With that context, and with the MSI rescaling lower overnight to a narrow bearish state just above $660, we wanted to find a spot to go long to retest Friday’s highs. While we don’t normally trade when the MSI is in a ranging state, the dip after the open to MSI resistance turned support gave us the entry. We went long at $662.35 with T1 set at MSI resistance at $663.60. That target was secured by 10 AM, and with the MSI rescaling higher, we set T2 at MSI resistance at $664.25. Once T2 was hit, there was little to do but trail the remaining 10 percent long position. As prices approached Friday’s highs, we considered taking off T3, but extended targets started printing so we held, keeping a stop at breakeven to see if the premarket level of $667.35 might be reached. Sure enough, by 3 PM SPY was just below this level, and on a double top at $667.15 we closed the final runner with thirty minutes left in the session. An absolute killer of a trade, thanks again to a clear plan, disciplined execution, and strong alignment between MSI signals, our broader market model, and key technical levels. The MSI continues to be a cornerstone of our consistent trading process.
Trading Strategy Based on MSI:
Tuesday has PMI and Powell speaking, both of which have the potential to move the market. Absent any external macro event, and given today’s strength, we expect more follow-through on Tuesday with additional new highs. The range is due to shrink materially, which should lead to more two-way trading that continues to favor the long side. As such, we will still buy dips. Overnight, the bulls want to defend $663, with SPY holding no lower than $657. Either dip should be treated as a buying opportunity. We will consider shorts below $657 and on failed breakouts near today’s high. Even if $657 fails, the bears will only come to life on a drop below $640. As such, it remains likely we continue to see new all-time highs, and our bias remains to buy on dips. As always, failed moves remain among the highest-probability setups. Stay nimble, avoid trades during Ranging Market States, and ensure full alignment with MSI. 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

Summary of Current Dealer Positioning:
Dealers are selling SPY $667 to $680 and higher strike Calls while buying $668 Call implying the Dealers belief that prices may tread water at recent levels, but if price breaks above $668, they wish to participate. The ceiling for Tuesday appears to be $669. To the downside, Dealers are buying $666 to $600 and lower strike Puts in a 3:1 ratio to the Calls they’re selling/buying displaying little concern that prices could move lower tomorrow. Dealer positioning is unchanged from slightly bearish/neutral to slightly bearish/neutral.
Looking Ahead to Friday:
Dealers are selling SPY $667 to $690 and higher strike Calls while also selling $663 to $665 Puts implying the Dealers belief that prices will likely slow their ascent around current levels but remain above $663. This aggressive positioning clearly displays the Dealers’ confidence in higher prices. The ceiling for the week appears to be $670. To the downside, Dealers are buying $666 to $540 and lower strike Puts in a 4:1 ratio to the Calls they’re selling, reflecting a bearish outlook for the week. This is likely more hedging than a bearish prediction. For the week Dealer positioning is unchanged from 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 closed at $666.78, another record high, reaffirming the uptrend. Longs remain favored above $663, targeting $670 and $674. Shorts may be considered on failed breakouts or weakness below $657. With key data ahead and volatility edging higher, manage risk carefully and avoid complacency. As always, rely on model levels and MSI alignment for high-probability setups.

Good luck and good trading!