Market Insights: Thursday, December 11th, 2025

Market Overview
Stocks extended their gains Thursday following Wednesday’s post-FOMC breakout, with the Dow notching another record high and the S&P 500 inching closer to 7,000. Investors remained focused on the Fed’s dovish shift, which is fueling confidence in a year-end rally. Despite a sharp overnight drop triggered by Oracle’s surprise announcement, the market staged a strong recovery that gained traction throughout the day. Traders largely shrugged off early weakness, choosing instead to build on Wednesday’s momentum. Economic data took a back seat, while earnings from Broadcom, Costco, and Lululemon were in focus after the bell for further signals on AI strength and consumer demand.

SPY Performance
SPY opened at $685.08 and dipped to $682.17 early in the session following the overnight weakness but quickly rebounded to push higher through the afternoon. Price climbed to an intraday high of $689.25 before closing just slightly below that at $689.12, up 0.23% on the day. Trading volume came in at 74.57 million shares, slightly above average, confirming solid buying interest. Today’s price action reinforced Wednesday’s breakout, with bulls defending key support at $682 and reclaiming control after brief morning volatility. The clean push above $686 and steady move into the close reflected strong market participation and follow-through from the Fed-driven rally.

Major Indices Performance
The Dow added 0.76%, marking another all-time high and continuing to lead the broader market higher. The S&P 500 rose 0.23%, while the Nasdaq slipped 0.26% as tech stocks lagged. The Russell 2000 outperformed once again with a gain of 1.18%, as falling yields continue to favor small caps. Crude oil declined 1.06% to $57.84 but remains above the critical $56 level that supports a bullish bias. Gold rose 1.86% to $4,303, and Bitcoin was unchanged, holding steady above $92,300. The 10-year Treasury yield ticked down to 4.151%, continuing to ease pressure on risk assets and supporting the ongoing rally.

Notable Stock Movements
GE Vernova continued to rally following this week’s dividend news, while retail names held steady ahead of earnings. Within the Magnificent Seven, Netflix led with a 1.49% gain, joined by Meta and Microsoft in the green. The rest of the group declined modestly, with Oracle’s post-earnings selloff contributing to the broader weakness in tech. Nvidia and other AI names also came under pressure as investors digested Oracle’s cautious tone on infrastructure spending. Despite some rotation, the broader leadership remains intact with no signs of meaningful deterioration.

Treasury Yield Information
The 10-year yield eased another 0.48% to 4.151%, extending its decline since Tuesday and giving equities further breathing room. The move reflects increased demand for Treasuries amid the Fed’s dovish pivot and declining inflation expectations. As long as yields remain below 4.5%, stocks are likely to stay supported, and duration-sensitive sectors may continue to benefit.

Market Sentiment and Key Levels
SPY’s projected maximum range for Friday is $683 to $694, with Calls dominating across a wide band, pointing to continued upward pressure within a consolidating trend. Today’s strong defense of $682 and close near the highs leaves bulls firmly in control. Key resistance now sits at $690, $691, $693, and $695. Support rests at $686, $683, $680, and $675. Holding above $686 will be critical for bulls to maintain momentum. A clean break above $690 could open the door to $695, while a move below $680 would be needed to shift sentiment meaningfully bearish. For now, the trend remains intact and bullish above $640.

Expected Price Action
Price action today was bullish and orderly, with a brief dip at the open quickly reversed as SPY found buyers at $682. Momentum picked up steadily through the afternoon, and with price closing near resistance, the path of least resistance remains higher. For Friday, we expect a consolidation phase between $686 and $690 before another potential push toward $694–$695. Dips to $683 or $680 should be bought, while any breakout above $690 may stall temporarily at stacked resistance. Volatility may compress as traders digest the week’s macro catalysts.

Trading Strategy
With the Fed behind us, the path remains clear for a continuation higher. For Friday, we prefer long setups from support at $683–$685 with defined stops below $680. Tactical shorts near $690–$691 can be considered only if momentum fades. Avoid chasing strength blindly near all-time highs. Use the MSI and model levels for tighter risk control and trade selection.

Model’s Projected Range

SPY’s projected maximum range for Friday sits between $683 and $694, with the Call side dominating in a narrow band that signals choppy price action with intermittent trending periods. Today the market moved higher in a slow, choppy grind after selling off overnight and testing $682.50 before dip buyers stepped in. With a dovish Fed statement fueling the market, SPY closed up 0.23% at $689.17, just shy of the all-time high. Overnight SPY sold off more than the bulls wanted, but they managed to keep price above the $682 level identified yesterday. Bulls stepped up again after a second test of this level at 10 am, and from there the bears had little left as the market drifted higher all day on higher-than-average volume. It was a difficult session to read and even harder to trade. If you did not get long at major support, there was little structural opportunity to enter, especially after noon. At the open, with SPY sitting at $685, the day’s direction was unclear, but the second dip to $682 was bought aggressively and the bulls pushed higher on the strength of yesterday’s FOMC rally and close above $685. We stated yesterday the bulls have complete control, and today they proved it. Price got within pennies of the all-time high, and it is highly likely we see new highs overnight or Friday. Tonight the bulls want to hold above $686 to all but guarantee new highs on Friday. If $686 fails, SPY may test $683, and a break there opens the door to $680. That level must fail for the bears to have any chance; otherwise every dip will continue to be bought. Volume was above average today, which supports higher prices in the coming days. Absent a catalyst, resistance sits at $691, $693, $695, and $698, with support at $688, $683, and $680. Above $690 gains should be muted due to heavy resistance, while a break below $680 could send price toward $675. The broader trend remains bullish above $640, and the bulls dominate the market. For Friday we prefer longs from support above $683 while watching carefully for shorts near $695. Crypto was flat today while Mag stocks were mixed. The market will continue rising until material weakness appears in these two leadership groups. VIX fell 5.20% to 14.95 and remains in risk-on territory. Traders should stay flexible with a bullish tilt while noting caution near the all-time highs. The model still sees $700 as a real possibility by month’s end as the seasonal Santa Rally continues to develop. SPY closed mid-channel inside the redrawn bull trend, which still points to higher prices.

Market State Indicator (MSI) Forecast

Current Market State Overview:
The MSI ended the session in a Bullish Trending Market State, with SPY closing above MSI resistance turned support. There were extended targets at the close and also for most of the afternoon session. Overnight the MSI rescaled lower to a ranging then bearish state as SPY tested $682.50 in the premarket. But around 5 am the MSI rescaled back to a ranging state which remained for the entire morning session, except for a brief rescale lower on the second test of $682.50. After noon the MSI began a series of rescalings higher with extended targets which saw the herd push price to just below the all-time highs. For tomorrow the MSI is forecasting higher prices which will almost certainly break the prior all-time high. MSI support is currently at $688.60 and lower at $687.08.
Key Levels and Market Movements:
On Wednesday we stated, “If $685 fails, the lowest the bulls want price to retrace to is $682,” and noted, “A retest of $682 would not surprise us, and a bounce from that level could send price back toward the all-time highs,” while adding, “We continue to favor the bulls as long as price stays above $682.” With this context, and with the MSI in a ranging state in the premarket and at the open, we waited for a clean long entry. A second test of $682.50 created a textbook failed breakdown, so we went long at $683 with T1 at the premarket level of $686.40. T1 hit by 10 am, and we then set T2 at $687.90, which hit just after noon. With two targets secured, we moved our stop to breakeven and held the remaining 10% of our position to see if price might reach the all-time highs. The move was slow and choppy, but price held firm, and extended targets continued to print. When SPY reached the next premarket level at $688.90, we took profits and ended the day with one strong trade. One and done and a good one it was, thanks again to having a clear plan, maintaining patience and discipline, and staying aligned with MSI signals, market structure, and our broader trading framework. The MSI continues to prove its reliability as the cornerstone of our trading process.
Trading Strategy Based on MSI:
Friday will likely bring new all-time highs with SPY pushing toward $695. The bulls will defend $686 overnight, and if that level fails, they want the dip held at $683. As long as price stays above $683, the bulls remain in control and new highs are expected. If $683 breaks, the bears will try to press lower, though we see this as a low-probability outcome. If $686 holds overnight, the bulls are showing strength and are unlikely to allow any meaningful pullback. Crypto was flat today and Mag stocks were mixed, showing some indecision that could weigh on equities, yet the market is rotating into other names which may help fuel a move higher into 2026. The long-term bull trend remains intact above $640, so we continue to favor the bulls as long as price stays above $683. As always, stay alert to macro risks and be prepared to trade what you see in the coming days. 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 $690 to $710 and higher strike Calls indicating the Dealers’ belief that prices may not have much more left in the tank for Friday. They are no longer selling ATM Puts but they were spot on with that call today. The ceiling for tomorrow appears to be $695. To the downside, Dealers are buying $689 to $565 and lower strike Puts in a 3:1 ratio to the Calls they’re selling displaying little concern that prices could move lower tomorrow. Dealer positioning is unchanged from neutral/slightly bearish to neutral/slightly bearish.
Looking Ahead to Friday:
Dealers are selling SPY $690 to $740 and higher strike Calls indicating the Dealers’ belief that prices may slow their ascent next week, although Dealers are clearly positioned for higher prices. The ceiling for the week appears to be $705. To the downside, Dealers are buying $689 to $565 and lower strike Puts in a 4:1 ratio to the Calls they’re selling, reflecting a market that is not overly concerned about lower prices. For the week Dealer positioning is unchanged from slightly bearish to 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
Use strength into $688–$690 to trim longs or initiate tactical shorts. Buy dips toward $686–$683 with defined risk. With FOMC behind us, the market may grind higher into year-end. Stay flexible, lean bullish, and trust the MSI for key intraday pivots. Avoid chasing breakouts without confirmation, and keep risk tight as we near all-time highs.

Good luck and good trading.