S&P 500 Daily Update for Friday March 21, 2025

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Summary of the S&P 500 Daily Update for Thursday, March 20, 2025, covering the market action and outlook for Friday, March 21, 2025:
Market Performance on Thursday, March 20:
The day started with a lower open after the SPX futures drifted from positive to negative overnight.
Early buying pushed the market into positive territory, surpassing the daily pivot (5671) and exceeding 5,700, but it hit resistance at Wednesday’s high and declined.
The market closed down 0.22% on below-average volume, finishing slightly below the daily pivot after finding support at 5,650.
No significant follow-through was observed after Wednesday’s bounce following the Fed’s announcement of unchanged rates.
Underlying Trends and Indicators:
The short and intermediate-term trends remain negative, with the SPX below the 200-day moving average, though long-term support is holding.
Subtle improvements are noted in some indicators: short-term momentum is turning positive, and intermediate-term indicators show slight progress, though a solid down day could reverse these gains.
Growth versus value remains stagnant, with no major improvement or breakdown. Mega caps weakened after Wednesday’s strength.
The VIX closed at 19.8 (below the 20 threshold), indicating reduced volatility, while the StochRSI shows short-term momentum improvement, though unconfirmed by other indicators.
Economic Context:
Interest rates dipped slightly (10-year yield at 4.23% from 4.26%), and the yield curve (10-year to 3-month) remains inverted.
Economic reports included slightly higher-than-expected jobless claims (223,000 vs. 220,000), continuing claims at 1.892 million, a better-than-expected current account balance (-303.9B vs. -334B), a Philadelphia Fed Index of 12.5 (indicating expansion), and strong existing home sales (4.26M annualized, up 4.2% month-over-month).
Global rate decisions were mixed: Swiss cuts, Brazil hikes, and no changes from China, Sweden, or the Bank of England. ECB warned of a 0.3% GDP hit from U.S. 25% tariffs.
Technical Observations:
The SPX is below key moving averages, with a non-confirmed Hindenburg Omen (deadline March 31). The ADX suggests a weakening downward trend, potentially signaling exhaustion.
Positive signs include the slope oscillator turning up and the TTM squeeze lightening, though many indicators (e.g., RSI, money flow) remain negative or neutral.
Outlook for Friday, March 21:
The short and intermediate-term outlook remains negative, with the market slightly oversold but showing some momentum improvement.
No economic reports are scheduled, but it’s a quadruple witching options expiration day, which could increase volatility and volume.
Seasonality is neutral to negative, with potential weakness in a post-election year, though the second half of March is historically more favorable.
Geopolitical factors (Russia-Ukraine, Israel, U.S. policy changes) and tariff concerns continue to weigh on sentiment.
Conclusion:
The market lacks short-term conviction, oscillating between defensive positioning and tentative growth stability. While some internal improvements are emerging, they’re fragile, and Friday’s session could be pivotal depending on volume and price action during options expiration.
PDF of Charts and Slides used in today's video:
https://drive.google.com/file/d/1Ptgu8H6HDJaqFz5VfO0PmuYtxpy2fc-Z/view?usp=sharing
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