Market Insights: Thursday, November 6th, 2025
Market Overview
Stocks slumped Thursday as AI-led tech weakness and renewed labor market jitters reignited fears of a deeper correction. The Nasdaq dropped 1.90%, the S&P 500 fell 1.09%, and the Dow lost 0.84%—all three major averages erasing Wednesday’s rebound. The sharp selloff was triggered by a combination of disappointing price action in chipmakers, rising skepticism around AI valuations, and concerning jobs data that sparked a rush into bonds. A new Challenger, Gray & Christmas report revealed October saw the highest number of layoff announcements for that month since 2003, adding to concerns that the labor market is weakening. The report pushed the 10-year Treasury yield down 1.76% to 4.086%, its lowest in over a week, as investors rotated defensively.
Nvidia led tech stocks lower, falling sharply after Trump’s AI and crypto czar David Sacks ruled out any federal backstop for the artificial intelligence industry. His comments were a direct rebuke to speculation following remarks from the OpenAI CFO, which had hinted at a potential safety net. CEO Sam Altman later denied such plans were in motion, but the damage to sentiment was done. Shares of AMD and Qualcomm also declined, with the latter selling off over 4% despite posting strong earnings and upbeat guidance Wednesday night. The across-the-board weakness among chipmakers weighed heavily on the Nasdaq and cast doubt on the durability of the AI trade.
Tesla shares dropped 3.5% ahead of Thursday afternoon’s high-stakes shareholder vote on Elon Musk’s proposed trillion-dollar compensation package. The meeting sparked speculation that Musk could step down as CEO if the proposal fails to pass. Elsewhere, the Supreme Court heard additional arguments over Trump-era tariffs, with several justices signaling skepticism around the breadth of executive authority under Section 232. A ruling against the policy could unwind key trade barriers and reshape international commerce. Treasury Secretary Scott Bessent maintained his optimism, calling the outlook “very, very positive,” but markets appeared unconvinced.
Earnings continued to trickle in, with Warner Bros. Discovery, Airbnb, and Moderna reporting results. The broader tone, however, was dominated by macro headwinds and fading investor enthusiasm around stretched tech valuations. Thursday’s action marked the steepest one-day drop for the Nasdaq since mid-September and reaffirmed growing fragility in market leadership. With the government shutdown dragging on and volatility climbing, traders now look to Friday’s jobs report—pending the shutdown’s resolution—for potential direction.
SPY Performance
SPY opened at $676.53 and sold off sharply throughout the day. It hit a high of $677.38 early in the session before declining to an intraday low of $668.72 and closing at $670.21, down 1.09%. Volume came in at 76.91 million shares, above average, confirming the risk-off tone. The drop erased all of Wednesday’s gains and landed SPY right on major structural support at $670. A breakdown from here risks a retest of $665, while any rebound will need to quickly clear $675 to neutralize the sell pressure.
Major Indices Performance
The Nasdaq led the market lower, falling 1.90% as chip stocks dragged the tech-heavy index into correction territory. The S&P 500 dropped 1.09%, and the Dow declined 0.84%, with both indices extending their recent pullback. The Russell 2000 was the lone standout, rising 1.49% in a show of resilience among small caps. Still, breadth remained weak, and leadership from mega caps continued to deteriorate, adding to the cautious tone.
Notable Stock Movements
The Magnificent Seven posted their worst collective day in weeks, with the exception of Alphabet, which managed a 0.15% gain. Nvidia, AMD, and Qualcomm all declined sharply, dragging on the broader semiconductor space. Tesla sank 3.5% ahead of its pivotal shareholder vote, while Apple, Meta, Amazon, and Microsoft closed lower. The pressure on key leadership names added weight to fears of a developing correction, especially with AI and tech sentiment deteriorating.
Commodity and Cryptocurrency Updates
Crude oil fell 0.12% to close at $59.53, still holding above the critical $56 level. Our model continues to project a move toward $70 if oil stabilizes, though Thursday’s action was muted. Gold edged down 0.10% to $3,988 as investors sought refuge in bonds instead of precious metals. Bitcoin fell 2.72%, closing just above $100,800, continuing its retreat from recent highs and reflecting broader de-risking across speculative assets.
Treasury Yield Information
The 10-year Treasury yield fell 1.76% to 4.086% following the weak jobs data, its lowest level in over a week. While yields remain well below the 4.5% warning threshold for equities, the downward move reflects growing anxiety about economic strength. A reversal in yields back above 4.5% would likely weigh heavily on risk assets, and levels beyond 5% could still trigger a major equity correction.
Previous Day’s Forecast Analysis
Wednesday’s forecast correctly anticipated a rebound attempt followed by resistance near $680. SPY hit a high of $680.86 before reversing hard on Thursday and closing near the week’s lows. Our call to be cautious into $680 proved prescient, as the level once again marked a rejection point for the bulls. The forecast’s downside levels also proved effective as SPY returned to $670 and tested major support.
Market Performance vs. Forecast
SPY opened at $676.53, moved briefly higher, and then rolled over sharply, validating our bias that $680 would be difficult to reclaim without a catalyst. Thursday’s forecast range of $673 to $681 captured the majority of the day’s action, with the extended push to $668.72 marking a break below modeled support that invites concern. Forecast targets were effective, though downside expansion exceeded expectations late in the day.
Premarket Analysis Summary
Thursday’s premarket notes warned that remaining below $678.40 would favor short entries, with $676.10 and $672.90 as downside targets. SPY failed to retake bias and hit both downside levels before dropping further to $668.72. The analysis also highlighted that the move over $680 would likely fail, and the plan to short rejections at key levels proved accurate and actionable.
Validation of the Analysis
The premarket framework and forecast roadmap aligned well with Thursday’s price action. Rejection below bias offered strong short setups, and the extended breakdown validated the view that selling rallies into resistance was the preferred strategy. The model continues to deliver highly accurate directional and structural calls, offering high-confidence setups to tactical traders.
Looking Ahead
SPY’s projected range for Friday is $662.75 to $680. Resistance sits at $672, $675, $677, and $680, with support at $670, $667, $665, and $660. With no economic data scheduled unless the government shutdown ends, volatility will likely be driven by headlines and residual earnings reactions. SPY closed at the lower boundary of its bullish channel from the April lows, and a break below $670 could begin a more meaningful unwind of 2025’s gains.
Market Sentiment and Key Levels
SPY ended the session at $670.21, right on critical support. The VIX rose 8.38% to 19.52, its highest close in two weeks and a sign that traders are increasingly hedging risk. A move above 20 could bring additional pressure. Bulls must reclaim $675 to stabilize the market and break through $680 to regain control. A sustained breakdown below $670 raises the risk of acceleration toward $665 and beyond.
Expected Price Action
Expect continued volatility with downward bias unless $675 is recovered quickly. A move above $677 could trigger a short-term squeeze to $680, but the burden of proof is now on the bulls. Conversely, failure at $670 would open the door to $667 and then $665. If SPY cannot hold those levels, we may see an expansion lower toward $660 or below.
Trading Strategy
Stay short under $675 and sell rallies that fail to break $677. A clean rejection at $680 remains a high-probability short entry. Wait for MSI confirmation before entering positions, and avoid initiating trades during Ranging Market States. A break of $670 with volume could accelerate downside, while a firm reclaim of $675 would offer a tactical long toward $680. Remain reactive, not predictive.
Model’s Projected Range
SPY’s projected maximum range for Friday sits between $662.75 and $680, with the Put side dominating in an expanding band that signals potential trending price action punctuated by chop. There’s no economic data due tomorrow, and with the ongoing government shutdown and active earnings season, traders should anticipate headline-driven volatility. Today’s decline was fueled by renewed tariff comments and concerns over a possible 10% air traffic reduction tomorrow, with SPY dropping 1.07% to close at $670.31—erasing all of Wednesday’s rebound and extending losses. While the bulls remain technically in control above $640, the bears gained significant traction today, and without an external catalyst, a meaningful recovery may be difficult to sustain. For the bulls to reassert control, a firm close above $675 is the first critical test, with a reclaim of $680 required to fully retake dominance. A rejection or failure at either of those levels would likely attract sellers, setting up a retest of today’s lows or even deeper weakness. Should $670 fail on another test, SPY could easily slide toward $665, which would likely mark the start of a broader correction. Volume finished above average, underscoring a risk-off tone, though with both recent gaps now filled and SPY sitting on major support at $670, a short-term rally attempt toward $680 remains possible. Absent a major catalyst, resistance for Friday sits at $672, $675, $677, and $680, with support at $670, $667, $665, and $660. A decisive move above $675 could drive momentum higher, though gains will likely face resistance near $680, while a confirmed break below $670 would heighten correction risk with limited structural support until $665. Crypto fell sharply again today, and most Mag stocks were lower except Alphabet, which managed a small gain—an ongoing sign of selective strength amid broader weakness. As we’ve emphasized for weeks, sustained softness in leadership names and crypto could still trigger the 10–15% correction we’ve been tracking, and conviction across the bull trend continues to fade. The VIX jumped 8.38% to 19.52, signaling rising stress and edging close to risk-off territory. SPY closed right at the lower boundary of its bull channel from the April lows, and a confirmed break below $670 would mark the beginning of a meaningful unwind of 2025’s gains, though until that occurs, the long-term bullish structure remains technically intact, albeit challenged.
Market State Indicator (MSI) Forecast
Current Market State Overview:
The MSI ended the session in a Bearish Trending Market State, with SPY closing mid range. Extended targets printed in the morning session as SPY declined but stopped printing by noon as SPY found a base at $669 from which it rallied. Overnight the MSI rescaled lower through a ranging state and shortly after the open, to a bearish state as price steadily fell through major support. By 10 am the MSI rescaled to a bearish state and began a series of rescalings lower while printing extended targets below. The MSI continued to rescale lower until noon where it settled into a bearish state that lasted until @ 2 pm when SPY attempted to recover with the MSI rescaling to a ranging state. But that was not to last as in the last hour, SPY fell and the MSI returned to its afternoon, bearish state. For Friday the MSI is forecasting sideways to lower prices. MSI resistance is $671.93 with support at $668.98.
Key Levels and Market Movements:
On Wednesday we wrote, “SPY is once again likely to test both the day’s lows and highs as direction remains headline-driven by White House comments,” and noted, “The $673 level remains the critical line in the sand. If it holds, the broader bull trend stays intact, but if it fails and does not recover quickly, a deeper pullback and potential gap fill become increasingly likely,” while also adding, “We’ll be watching closely for failed breakouts between $679 and $681 with MSI confirmation, or a break of $675 to initiate shorts.” With this context, and with the MSI opening in a ranging state after a failed breakout at $680 in the premarket, our plan was to look for a short entry once structure aligned. Trading mid-MSI in a ranging state isn’t ideal, so we waited for a setup with edge. That came after the MSI rescaled lower to a bearish state and began printing extended targets below. When SPY rallied back to MSI resistance at $675.32, we entered short and set T1 at MSI support at $673.23. With T1 hit quickly, we waited for the MSI to rescale again and set T2 at MSI support at $671.78. With no lower premarket levels to lean on, we moved our stop to breakeven and trailed as the MSI continued to rescale lower. Eventually, SPY reached $669, where extended targets stopped printing and a textbook failed breakdown formed at 12:26 pm. That was our cue to exit and reverse long, setting T1 at MSI resistance at $671.95. It took over an hour, but T1 was reached, allowing us to set T2 at the premarket level of $673. A triple top developed near $673.35, so with two well-executed trades and a solid profit cushion, we exited our trailer and called it a day. Another consistent, high-quality session, built from a having a plan, patience, discipline, and perfect alignment between MSI signals, market structure, and our broader trading model. The MSI continues to prove its reliability as the cornerstone of our trading process.
Trading Strategy Based on MSI:
Friday the bulls may attempt a recovery to push price toward $675, the first step in trying to reclaim momentum from the bears, but they must first defend $669 making this level a critical decision point for the bulls. SPY may once again test both today’s lows and highs as direction remains heavily influenced by White House headlines or key earnings results. The $670 level stands as the key line in the sand; if it holds, the broader bull trend remains intact, but if it fails and doesn’t recover quickly, a deeper pullback becomes increasingly likely, giving the bears the upper hand. Should SPY reclaim $680, the bulls will aim for $685 and then $690. With the market still driven largely by external catalysts and limited economic data ahead, traders must stay nimble and trade what they see. On the downside, dip buyers repeatedly defended $669 today, but each retest weakens liquidity, increasing the risk of a clean break that could open the door to $665 or lower. While our bias remains to trade with the prevailing bullish trend, the bears now have a foothold they won’t easily surrender. Another rally to $675 or even $680 could again prove to be a dead cat bounce, as noted in yesterday’s report. We’ll be closely watching for failed breakouts between $675 and $681 confirmed by the MSI, or a break of $670 to initiate shorts. Conversely, a clean move above $681 on strong volume will trigger a long setup. With the VIX hovering near 20, early risk-off signals are emerging, but unless it breaks above 23, any weakness may prove short-lived. The key structural threshold for the broader bull market remains $640, a decisive break below that level would hand full control to the bears. For now, failed breakouts and failed breakdowns continue to offer the highest-probability setups, so remain flexible, avoid trading during Ranging Market States, 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
Summary of Current Dealer Positioning:
Dealers are selling SPY $683 to $705 and higher strike Calls while also buying $671 and $682 Calls reflecting the Dealers’ desire to participate in any relief rally on Friday. The ceiling for tomorrow appears to be $690. To the downside, Dealers are buying $670 to $600 and lower strike Puts in a 4:1 ratio to the Calls they’re selling displaying concern that prices could move lower. Dealer positioning is unchanged from bearish to bearish.
Looking Ahead to Next Friday:
Dealers are selling SPY $681 to $705 and higher strike Calls while also buying $672 to $680 and $685 Calls reflecting the Dealers’ desire to participate in any recovery rally next week. There is some volume in the Calls they are buying indicating some conviction that prices may rally from these levels. The ceiling for the week appears to be $690. To the downside, Dealers are buying $670 to $600 and lower strike Puts in a 6:1 ratio to the Calls they’re selling/buying, reflecting a market that is hedged heavily given its’ lofty levels. Dealers are fully hedged for what may come and added more protection today. For the week Dealer positioning is unchanged from bearish to bearish but again Dealers continue to add/hold significant protection. 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
Trade the roadmap. Stay short beneath $675 and sell failed rallies into $677 and $680. Use MSI signals to confirm entries, and be prepared for expanded volatility. Until $680 is firmly reclaimed, bears retain the edge. Manage risk, remain flexible, and let price action lead.
Good luck and good trading!
