Market Insights: Tuesday, December 2nd, 2025

Market Overview
Stocks edged higher on Tuesday as the market attempted to shake off Monday’s weakness, with all major indices logging modest gains and Bitcoin roaring back above $91,000. The Dow rose 0.39%, the S&P 500 added 0.30%, and the Nasdaq climbed 0.59%, buoyed by strength in Apple, which closed at another record high, and Intel, which surged 7% on rumors it may begin supplying chips to Apple within two years. Tuesday’s session marked a tentative recovery following a fragile start to the month, with investors balancing hopes for a year-end rally against lingering concerns around inflation, AI-driven spending, and stretched valuations. Crypto markets, which collapsed Monday, stabilized sharply, with Bitcoin logging its best day since April. That sharp reversal in risk sentiment brought a tailwind to equities, particularly in growth and tech names. Still, market breadth remained mixed, and many traders remain cautious, looking to key data later this week for confirmation of direction. With the Fed’s December meeting approaching, rate cut bets are building, adding another dimension to market expectations. Until fresh catalysts arrive, markets remain trapped in a rangebound environment with a slight bullish lean.

SPY Performance
SPY opened at $681.84 and traded in a tight range before closing up 0.17% at $681.43. After stalling early at $683.82 and pulling back to $679.33, price held firm into the close with moderate conviction on above-average volume of 56.35 million shares. Tuesday’s session showed the bulls still have control above $677, but also reinforced resistance at $685 remains a tough ceiling. For now, SPY remains confined between $675 and $685, a range that may hold unless upcoming data or unexpected macro headlines spark a breakout. With price holding above the critical $677–$678 zone, bulls remain in position to press higher toward $685 and $688, but another failure at those levels could reset the range toward $675 or even $670. Given the backdrop, price is more likely to chop sideways near the upper half of the recent range until volatility returns.

Major Indices Performance
The S&P 500 rose 0.30%, the Dow gained 0.39%, and the Nasdaq advanced 0.59%, reflecting strength across large-cap tech, semiconductors, and crypto-adjacent names. The Russell 2000 lagged with a 0.12% loss, failing to participate in the bounce and continuing its recent underperformance. Tuesday’s gains were broad but not powerful, more reflective of short-covering and rotational support than a decisive shift in sentiment. That said, bulls successfully defended key levels, and with Bitcoin leading risk higher, the environment remains favorable for modest upside continuation — especially if upcoming macro releases land on the dovish side.

Notable Stock Movements
Apple gained 0.81%, notching another record close and continuing its leadership role. Intel jumped 7.06% following speculation it could supply chips to Apple in the future. Nvidia added 1.19%, while Meta, Microsoft, and Alphabet all posted modest gains. Tesla slipped 0.21%, the only name in the Mag group to close red. Bitcoin’s 5.49% surge to above $91,000 led crypto-linked stocks like Coinbase and Robinhood higher, providing support to risk appetite. Crude oil dropped 1.16% to $58.63, while gold fell 0.82% to $4,239. With crypto bouncing and big tech showing strength, the bulls remain in control — but the absence of a clear catalyst keeps moves limited.

Treasury Yield Information
The 10-year yield dipped 0.27% to 4.086%, a minor move that helped ease pressure on growth stocks. Traders continue to monitor the bond market closely, with levels above 4.5% seen as potential headwinds for equities and any move above 5% signaling deeper trouble. For now, yields remain subdued, giving bulls some breathing room, but any hawkish surprise in upcoming data could change that dynamic quickly.

Looking Ahead
The market now turns its attention to a packed economic calendar with ADP and ISM due Wednesday, Jobless Claims on Thursday, and the delayed PCE and UoM sentiment reports rounding out the week on Friday. SPY remains in a holding pattern just below critical resistance. A break above $685 could target $688 and $690, while a failure to hold $679 could open the door to $675 and $670. Dealer positioning and MSI suggest continued choppiness, so expect limited trend until data provides a new directional driver.

Market Sentiment and Key Levels
SPY closed at $681.43, staying just below key resistance. Resistance sits at $685, $687, and $690, while support lies at $679, $675, and $670. SPY’s projected range for Wednesday is $676 to $688, with a continued Call bias and narrow dealer band pointing to another choppy session. Crypto strength and Mag stock leadership continue to support risk, but the lack of a catalyst leaves direction unclear. The broader trend remains bullish above $640, and while near-term upside is possible, gains remain constrained unless $685 is decisively cleared.

Expected Price Action
Tuesday’s price action followed a familiar pattern, stalling below $685 and bouncing off $679. Expect more of the same Wednesday unless economic data drives a change. If bulls hold $680 overnight, SPY may again attempt a push to $685, but rejection remains likely without volume. A break above $685 opens the door to $688, while a drop below $679 could expose $675 and $670. Consolidation remains the most likely path until Thursday or Friday’s data arrives.

Trading Strategy
Longs are favored near $679 with stops below $675 and targets at $683 and $685. Short entries are valid on failed breakouts near $685, with targets at $681 and $679. Avoid chasing price mid-range. The best setups remain failed breakouts or breakdowns near the edges of the established range. With macro catalysts looming, limit size and focus on clean, high-probability levels.

Model’s Projected Range

SPY’s projected maximum range for Wednesday sits between $676 and $688, with the Call side dominating in a narrow band that signals choppy price action with brief trending periods, and today the market attempted a recovery from yesterday’s sell-off with SPY rising 0.19% to close at $681.53, staying below $685 where the bulls regain full control but above $670 where the bears hold more influence. Overnight SPY moved higher and looked ready to push toward $685, but it stalled at $683.50 and then dropped to $679.50 before recovering into the close, leaving the day essentially flat and confirming another narrow, catalyst-free session similar to Monday, keeping SPY rangebound between $675 and $685 until new information arrives. Overnight the bulls will aim to hold $680 to frame today as a second day of consolidation after five straight green days, attempting another move above $685, while a failure of $680 increases the odds of retracing last week’s rally toward $675 and possibly $670. Volume was average again, supporting the broader structure, and absent a catalyst resistance sits at $685, $687, and $690 with support at $679, $675, and $670, and above $685 gains should be muted due to heavy resistance while a break below $675 could send price toward $670. The broader trend remains bullish above $640 and the near term still favors the bulls, so for Wednesday we defer to the prevailing trend and prefer longs from support near $679 while watching for short setups as price approaches $685. Crypto rose sharply today, recovering most of Monday’s losses, and Mag stocks were solidly green except Tesla which dipped slightly, and as noted for weeks, the market is likely to continue higher until meaningful weakness returns in these leadership groups. VIX fell 3.77% to 16.59 and remains in neutral territory waiting for a catalyst, and while December is historically strong the mixed start to the month leaves that outcome uncertain, so traders should stay flexible and trade what they see with a slight edge to the bulls for continuation of the recent five day rally, as SPY closed mid-channel within a redrawn bull trend that continues to weaken even as the brief bear channel has disappeared, suggesting higher prices remain likely.

Market State Indicator (MSI) Forecast

Current Market State Overview:
The MSI ended the session in a Bullish Trending Market State, with SPY closing at MSI support. There were no extended targets at the close, however there were periods of extended targets both above and below price in the premarket and regular session. This implies the herd is quickly moving in and out of positions with little conviction either way. Overnight the MSI rescaled higher to a bullish state and continued to rescale into the open with extended targets above. This pushed SPY to the day’s highs at $683.60 where the bears stepped in and said not so fast. Price fell rapidly to the day’s lows before noon which saw the MSI rescale to a narrow bearish state with brief periods of extended targets. But once those stopped printing, price made a V bottom to reverse with the MSI moving to a ranging state then to the current bullish state. SPY bounced around between these two states for the entire afternoon closing basically unchanged. For tomorrow the MSI is quite narrow which implies more the same with a slight long bias but with likely two way, choppy trading. MSI support is $681.53 with resistance at $682.23.
Key Levels and Market Movements:
On Monday we stated, “the battle continues to favor the bulls,” and added, “For Tuesday we will look for bounces toward $675 and also seek shorts up to $685 for two-day, rangebound trading,” while also noting, “look to buy dips more cautiously, fade rallies below $685 on failed breakouts.” With this context, and with the MSI opening in a narrow bullish state, we waited for a clean long off MSI support. That setup appeared at 9:52 am, and we entered long at $681.50 with T1 set just above MSI resistance at $682.50 to ensure at least a $1 profit. We set T2 at the premarket level of $683.60, which hit before noon. With two targets secured, we moved our stop to breakeven and trailed to see whether $685 might come into play. It did not, and SPY formed a textbook failed breakout, but because extended targets still printed above, we passed on the short and took final profits at $683 before waiting for the next opportunity. Price then dropped quickly, and although we wanted to short, the move was too fast to catch safely. Once SPY reached $679.50 and printed a failed breakdown with extended targets no longer printing, we entered long again at $679.95 with T1 at the premarket level of $681.10. T1 hit by noon, and we set T2 at MSI resistance at $681.55 while trailing the remainder. After another pop and another failed breakout just after noon, we decided the market had given us enough for the day and exited the second long at $682.25, closing out a solid session with two clean trades. Two for two and done by 1 pm thanks 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:
Today’s choppy trading was difficult to navigate. The market is coiling and preparing to break out in either direction. Given the strength of the trend, we continue to favor the bulls, but we will also look for shorts on failed breakouts near $685, just as we did today. SPY is likely to remain in a narrow range between $675 and $685 until an external catalyst forces a move. Crypto bounced back, which supports the bull case, but that strength must hold. We suggest staying conservative until SPY reclaims $685 and watching crypto to confirm today’s recovery is not a dead cat bounce. For Wednesday we will look for bounces toward $677 and also seek shorts up to $685 for another rangebound session, as the MSI is forecasting slightly higher prices. If the bulls hold $680 overnight, they are likely to make a run at $685 to take full control. If $680 fails, the market is likely to test lower levels and possibly reach $670. Macro risks remain, so traders should stay alert for news about Venezuela or other developments that could move markets. Absent those risks, buy dips cautiously, fade rallies below $685 on failed breakouts, and sell below $670 if price falls that far. The long-term bull trend remains intact above $640, so favor the bulls and the larger trend as long as price holds above $680. 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 $682 to $700 and higher strike Calls implying the Dealers’ belief that prices are unlikely to rally significantly on Wednesday. The ceiling for tomorrow appears to be $685. To the downside, Dealers are buying $681 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 slightly bearish/neutral to slightly bearish/neutral.
Looking Ahead to Friday:
Dealers are selling SPY $685 to $700 and higher strike Calls while also buying $682 to $684 Calls implying Dealers’ desire to participate in any rally this week. The ceiling for the week appears to be $690. To the downside, Dealers are buying $681 to $565 and lower strike Puts in a 6:1 ratio to the Calls they’re selling/buying, reflecting a market that continues to be concerned about lower prices. 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
Trim longs near $683 and $685 and wait for breakout confirmation before chasing higher. Buy dips near $679–$680 with tight stops below $675. Short into $685 on failed breakouts. Align with MSI and dealer levels and avoid trading in mid-range chop. With key data coming, stay tactical, favor longs above $677, and keep stops tight. Maintain a bullish lean while respecting price structure.

Good luck and good trading!