S&P 500 Daily Update For Thursday April 17, 2025

Link to The SPX Investing Program https://spxinvesting.substack.com/

Wednesday Market Recap:
Market Performance: The S&P 500 experienced a significant decline, closing down 2.24% with below-average volume. The market opened at S2 (5347), briefly rose to just under S1 (5372), but drifted lower, breaking below 5,300 later in the day, reaching S4 (5219) before a slight rebound to close below S3 (5283).
Market Trends: All timeframes (short, intermediate, long-term) are now in downtrends, confirmed by moving average crossovers (e.g., 50-period below 200-period for the S&P, signaling a long-term downtrend that has been developing since November/December 2024). This shifts the market bias to negative, unlike the prior bullish default.
Key Events:
NVIDIA Tariff Impact: News of a high tariff on NVIDIA led to a 6.9% drop in its stock, with a $5.5B charge expected due to China export restrictions. AMD also fell 7.4%, anticipating an $800M hit. This dragged down S&P and NASDAQ 100 futures.
Jerome Powell's Speech: Fed Chair Powell’s remarks lacked confidence in achieving the Fed’s dual mandate (full employment, stable prices), contributing to the market breaking below 5,300. This reinforced perceptions of a "Fed put" absence.
Technical Indicators:
The VIX: Rose to 32.64, signaling heightened fear (above 30 is challenging; markets struggle above 20).
Death Crosses: Confirmed across the S&P 500, NASDAQ 100, small/mid/micro caps, Wilshire 5000, and bank ETFs, indicating broad-based downtrends.
Momentum Oscillators: Short-term indicators (e.g., rate of change, slope oscillator) are extreme negative. Intermediate-term indicators (e.g., TTM squeeze, price momentum oscillator) worsened after brief improvement attempts.
Sentiment: Equity put/call ratios rose, reflecting fear and hedging. Sentiment dropped to 14 (from 19), with the 10-to-3-month yield curve re-inverting.
Economic Data:
Retail Sales: Up 1.4% (stronger than expected), but possibly driven by pre-tariff buying.
Industrial Production: Down 0.3% (as expected). Capacity utilization at 77.8% (slightly below expectations).
MBA Mortgage Applications: Down 8.5% due to recent interest rate spikes.
Business Inventories: Up 0.2% (below expectations), a concern if tariffs increase stockpile.
NAHB Housing Market Index: At 40, slightly above expectations.
Sector Performance: Tech, communication, and discretionary sectors saw the largest declines. Energy was the only sector up, acting defensively. Financials held up relatively well, but bank ETFs showed weakness.
Interest Rates: 10-year yield fell to 4.28% (from 4.32%), a positive sign. The dollar is below 100, with speculation about intentional devaluation to ease U.S. debt.
Thursday Outlook (April 17, 2025):
Market Context: Thursday is effectively the week’s “Friday” due to markets closing for Good Friday. It’s also monthly options expiration, which may increase volume (historically up 67% of the time since 1980, though no clear edge in post-election years).
Key Events:
European Central Bank: Expected to cut rates by 25 basis points, potentially impacting global sentiment.
Economic Reports: Initial claims, housing starts, building permits, and Philadelphia Fed Index will be released, offering insights into employment and housing.
Geopolitical Factors: Ongoing concerns about tariffs, Israel, and Russia-Ukraine conflicts may influence sentiment.
Technical Outlook: The SPX remains negative across all timeframes. Extreme negative readings (e.g., oversold indicators) may persist longer due to the confirmed long-term downtrend, unlike in bullish periods where recoveries were quicker.
Seasonality: Neutral to positive for Dow and S&P, negative for NASDAQ. However, recent weakness and tariff uncertainty may overshadow seasonal patterns.
Positive Notes: Lower interest rates, financial sector holding, and some bullish percent index improvements offer slight hope, but there is a lack of leadership in growth/value ratios and discretionary weakness temper optimism.
Risks: Continued tariff-related fears, lack of Fed clarity, and potential for further tech sector declines could drive more downside. The VIX above 30 suggests a volatile environment.
Conclusion: The market is in a confirmed bearish phase across all timeframes, driven by tariff fears, Fed uncertainty, and tech sector weakness. Thursday’s session, with options expiration and ECB rate decisions, may see heightened volatility, but the overall bias remains negative unless significant positive catalysts emerge.

PDF of Charts and Slides used in today's video:
https://drive.google.com/file/d/1sbYT5RhK_X8HomopPX23p1BamEKEFZ6v/view?usp=sharing

DISCLAIMER This video is for entertainment purposes only. I am not a financial adviser, and you should do your own research and go through your own thought process before investing in a position. Trading is risky!