S&P 500 May 12, 2025 Trade Talks, Low Volume, and Market Uncertainty

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Market Update Summary for Friday, May 9, 2025, and Outlook for Monday, May 12, 2025
Friday Market Recap:
Market Action: A lackluster day with low conviction, closing slightly negative (-0.07%) on well below-average volume. Prices opened higher but fell below the daily pivot (5673), found support at 5650, and traded sideways.
Trends:
Short & Intermediate Term: Positive, as the market is above the 20-period and 50-period moving averages.
Long Term: Negative, in a downtrend below the 200-day moving average.
Volume: Persistently below average, reflecting market indecision.
Sentiment & Indicators:
VIX at 21.9, above 20, indicating elevated volatility.
Short-term indicators (e.g., StochRSI, Williams%R, CCI Indicators, Stochastics) remain positive but lack strength. The Intermediate-term indicator TTM Squeeze is extreme positive but turning negative.
Smart money indicators (Accumulation/Distribution, Chaiken Money Flow, Chaiken Oscillator) show weakness.
Advance-decline line and bullish percent indexes (S&P, NASDAQ, NYSE) remain positive.
Sector Performance: Energy was the strongest performer, while the healthcare and communication sectors lagged. Growth underperformed value slightly.
Key Influences:
US-China Trade Talks: High anticipation for talks in Switzerland over the weekend, with hopes for tariff de-escalation (current US tariffs: 145%, China: 125%). The Trump administration is considering tariffs of 60% or less, though Trump mentioned 80% on Truth Social. A lack of progress could disappoint the markets.
Economic Data:
No major reports on Friday, but weekly jobless claims and continuing claims are stable, suggesting no immediate recession signals.
Upcoming reports (CPI on Tuesday, PPI and retail sales on Thursday) will provide inflation insights.
Interest Rates & Bonds: 10-year Treasury yield at 4.38%, up slightly. The 10-year to 3-month yield curve is no longer inverted but is close.
Market Dynamics: The market is in a trendless state (ADX below 20 in short and intermediate terms), with potential overhead resistance at the 100-day moving average and the 61.8% Fibonacci retracement level.
Outlook for Monday, May 12, 2025:
Focus: Market reaction to trade talk outcomes, with futures opening Sunday evening providing early clues (check investing.com).
Economic Calendar: Treasury budget report due, but major reports (CPI, PPI, retail sales) come later in the week.
Seasonality: Neutral to slightly positive for Dow and S&P 500, neutral to negative for NASDAQ. Options expiration week introduces a slight negative bias (down 53% of the time).
Technical Outlook:
Positive in short and intermediate terms but vulnerable to disappointment if trade talks falter.
Negative in the long term, with resistance at the 200-day moving average (SPY hit this on Thursday).
Watch for support at 5575 (pivot point) and resistance at the 61.8% Fibonacci level.
Strategy: Remain cautious, monitor futures, and prepare for volatility based on trade talk news. Sideways strategies may be appropriate in the current trendless environment.
Conclusion: The market is in a holding pattern, with low conviction and focus on US-China trade talks. While short- and intermediate-term trends are positive, the long-term downtrend and potential resistance levels suggest caution. Key economic data and trade talk outcomes will drive direction this week.

PDF of Charts and Slides used in today's video: https://drive.google.com/file/d/1IYGmR6-ZH2B-n6Mll4adheUdc2L6rPAt/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!