Rally Despite Low Volume: Israel Iran Tensions Spark Friday Volatility June 13, 2025

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

Link to The Daily Pivot Newsletter: https://thedailypivotnewsletter.substack.com/

Join to get access to perks:
https://www.youtube.com/channel/UCxlaGAKm2ApEs13O1gWDltg/join

Market Summary for Thursday, June 12, 2025, and Outlook for Friday, June 13, 2025
Thursday Market Recap:

The market opened lower but saw "buy the dip" activity, pushing prices above the unchanged level and the daily pivot at 6,028. Prices oscillated with choppy trading but surged into the close, ending at the intraday high, up 0.38%.

Volume remained below average, a consistent trend.

Economic reports, including a cooler-than-expected PPI (+0.1% vs. +0.2% expected) and stable initial jobless claims (248,000), were market-friendly. However, continuing claims rose to 1.956 million, signaling potential longer-term employment concerns.

Short, intermediate, and long-term trends remain positive, with no strong trending (ADX not confirming a trend).

Interest rates dropped to 4.36% for the 10-year yield, potentially supporting stocks. The dollar weakened, and oil prices rose to the mid-70s due to geopolitical events unfolding between Israel and Iran.

Sectors: Utilities led, followed by tech. Discretionary and communication lagged, impacting growth stocks.

Key stocks: Microsoft and Nvidia gained, while Tesla, Google, and Meta declined.

Technicals: Short-term momentum was positive (StochRSI, Williams %R), but some indicators (e.g., PMO) remain extreme. Growth outperformed value slightly for the large caps, but financials continue to underperform the S&P.

Geopolitical Impact:

After market close, Israel launched a preemptive strike on Iran, eliminating key figures. This sent futures down 1.5% currently.

Iran’s control of the Strait of Hormuz raises concerns about oil supply disruptions, pushing oil prices higher.

Israel braces for retaliation, and U.S. involvement was denied by Secretary Rubio. The strike followed Iran’s threats and ICBM development.

This event is expected to dominate the news, potentially overshadowing U.S. protests and trade talk concerns.

Friday Outlook:

Futures suggest a lower open due to geopolitical tensions, with potential for volatility on Friday the 13th.

The market’s "buy the dip" resilience may be tested, but historical oversold conditions (e.g., post-Katrina 2005) suggest a possible rebound if futures become oversold.

Key levels: S&P futures are below 6,000; support levels will be critical.

Consumer sentiment data is due Friday, which could influence market direction.

Seasonally, June 13 is neutral to positive for major indices, but post-election years often see weakness are late mid-June.

Gold and bonds may see inflows as safe-haven assets amid geopolitical uncertainty.

Conclusion:

Thursday showed resilience with a positive close despite low volume and mixed economic signals.

The Israel-Iran escalation introduces significant uncertainty, likely leading to a volatile Friday open.

Trends remain positive across time frames but lack conviction. Investors should monitor oil, gold, bonds, and key support levels for market direction.

PDF of Slides: https://drive.google.com/file/d/1vk3tOGajSwt7OgwK18FYCJyQ-D-TM1in/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!