S&P 500 Update for Monday March 17, 2025

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Summary of the market update for Friday, March 14, 2025, and the outlook for Monday, March 17, 2025:
Market Performance on Friday, March 14, 2025:
Broad-Based Gains: The S&P 500 rose over 2% (up 2.13%), closing slightly above the R2 resistance level at 5634, after opening above R1 at 5577 and initially hitting resistance at 5600. The market ended at the session high.
Volume Concerns: Despite the strong up day, volume was below average, suggesting a lack of conviction compared to recent above-average volume days during declines.
Technical Levels: The SPX bounced out of correction territory (now ~8% below the all-time high, down from 10%+ intraday).
Sectors and Mega Caps: The rally was broad-based, led by mega-cap stocks (e.g., NVIDIA up 5%, Tesla up 3.86%, Meta up ~3%). All sectors ended positive, with tech, discretionary, and communication outperforming defensive sectors such as staples and healthcare.
Key Indicators:
Short and intermediate-term trends remain negative; the S&P is below its 200-day moving average.
The Long-term trend is mixed but supported by a weekly pivot point holding above a key support level.
The VIX dropped to 21.77 (still above 20, indicating elevated volatility), and gold briefly broke above $3,000 before retreating slightly.
Market Context:
Interest Rates: The 10-year yield rose to 4.31%, up from 4.27% on Thursday. A move to 4.5% could reignite market concerns.
Inflation: This week CPI and PPI data were weaker than expected, tempering inflation fears for now, though tariff-related inflation risks loom.
Economic and Political Factors: A U.S. government shutdown was averted, U.S.-Canada trade tensions eased, and China may introduce stimulus, potentially aiding the global economy and S&P 500 companies.
Sentiment: Consumer sentiment weakened (57.9 vs. 65.6 expected), adding to uncertainty, but extreme negative sentiment (e.g., equity put-call ratio spiked Thursday) may signal a potential bounce.
Technical Analysis:
Short-Term: Momentum indicators (e.g., ADX above 40, stochastic, slope oscillator) remain negative but less extreme after Friday’s rally. The market is still below the 20- and 50-day moving averages.
Intermediate-Term: Still far from the 50-day moving average, with TTM Squeeze and the Chande Trend Meter showing extreme negative readings, though improving slightly.
Long-Term: The weekly S&P chart shows support holding at a pivot point, despite being below the 200-day moving average. Oscillators such as the Coppock Curve and Special K are negative but hint at potential reversal if follow-through occurs.
Growth vs. Value: Growth outperformed value slightly on Friday, but the ratios remain below declining moving averages, indicating no significant shift yet.
Outlook for Monday, March 17, 2025:
Cautious Optimism: Friday’s rally worked-off some oversold conditions, but a lack of volume and persistent negative trends suggest it may be a temporary bounce rather than a trend reversal. More follow-through is needed.
Key Levels to Watch: Resistance at the 200-day moving average and support at the weekly pivot point. A break above the 200-day could signal strength; a drop the weekly low could resume the downtrend.
Economic Data: Empire State Manufacturing, Retail Sales, Business Inventories, and the NAHB Housing Market index data on Monday could influence sentiment. Wednesday’s Fed statement will be a major focus.
Seasonality: March 17 (St. Patrick’s Day) has a historically positive bias, and options expiration week (ending Friday) is up 64% of the time since 1980, potentially providing a tailwind.
Risks: Geopolitical tensions, tariffs, and Fed commentary could keep markets unsettled. Recession fears persist, though employment data remains strong.
Conclusion:
The market remains negative in the short and intermediate term, with a mixed long-term outlook. Friday’s rally was encouraging but lacks confirmation (e.g., volume, sustained momentum). Monday’s performance and upcoming data will be critical to determining if this is the start of a recovery or a pause before further declines.
PDF of Charts and Slides used in today's video:
https://drive.google.com/file/d/15M7yMddJX_xXagM9glzgR7wpRynjsYnb/view?usp=sharing
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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!