Market analysis for Feb. 24th, 2025

Welcome back traders! Friday was a day to forget for me. Just horrible. I was on wrong side of the market for both our SPX and our scalping and it bite me. We got a nice bounce back this morning with our Nat gas position adding 10K of profits right before expiration tomorrow and you know what? That's great. It certainly lifts spirits and makes today a little brighter but.... you can't and shouldn't depend on stuff like that to bail us out. I need to get back to solid risk management. It's a shame but sometimes it takes a day like Friday to reintroduce that concept to your brain. Here's a snapshot of our day Friday. 

Again...it's nice Nat gas helped us out today but we can't always depend on that. 

Let's take a look at the markets:
​Fridays selloff flipped the technicals to a bearish slant.

Taking a closer look at the major indices we trade: There are a couple things that jump out at me.
#1. The SPY and QQQ are now sitting right ontop of their 50DMA. This is a big demarcation point. Futures are up today. Does this level hold? It looks like it wants to. As far as IWM and DIA. Both are well below their 50DMA and IWM is actually looking to break below its 200DMA. Very bearish on both these indices. We have bearish setups on both of these in our ATM portfolio and will continue to hold and work those for the forseeable future.

Let's look at the expected moves this week:

I.V. is not horrible. Sort of middle of the road.

​The SPY hit all-time highs earlier in the week but then reversed, closing at $599.98 (-1.60%). What initially looked like a decisive move out of the range was all given back by the end of the week. The reversal came with a notable surge in volume, as shown in our RVOL color-coded volume indicator, signaling that selling pressure intensified as SPY gave back its breakout gains. Traders will be watching closely to see if this pullback finds support or if a deeper retracement is in play.

​While the QQQ briefly notched a new all-time high this week, it ended up closing down at $526.08 (-2.24%). It has remained trapped in the same daily range since November, struggling to establish a clear trend. Friday’s sell-off came on elevated RVOL, highlighting increased participation in the move lower. With no clear breakout in either direction, traders will be watching to see if QQQ finally picks a path—or if the chop continues.

​Since December, IWM has been stuck in a range and trailing behind its peers, closing at $217.80 (-3.61%). Unlike SPY and QQQ, which briefly hit new highs before reversing, IWM struggled to gain any real momentum. Its early February breakout attempt failed almost immediately, showing a lack of momentum. With the highest daily volume bar since December, selling pressure is accelerating, pushing small caps toward their year-to-date lows.

March S&P 500 E-Mini futures (ESH25) are up +0.53%, and March Nasdaq 100 E-Mini futures (NQH25) are up +0.42% this morning, pointing to a partial rebound from Friday’s selloff on Wall Street.
This week, investors look ahead to an earnings report from semiconductor stalwart Nvidia, comments from Federal Reserve officials, and the release of the Fed’s preferred inflation gauge along with other key economic data.
In Friday’s trading session, Wall Street’s major equity averages closed sharply lower. Akamai Technologies (AKAM) tumbled over -21% and was the top percentage loser on the S&P 500 after the content delivery networking company issued below-consensus 2025 guidance. Also, UnitedHealth Group (UNH) slumped more than -7% and was the top percentage loser on the Dow after the Wall Street Journal reported that the U.S. Justice Department had launched an investigation into the health insurer’s Medicare billing practices. In addition, Block (XYZ) plunged over -17% after the company posted downbeat Q4 results and provided weak FY25 gross profit guidance. On the bullish side, MercadoLibre (MELI) climbed more than +7% and was the top percentage gainer on the Nasdaq 100 after reporting better-than-expected Q4 results. 
Economic data released on Friday showed that the University of Michigan’s U.S. consumer sentiment index was revised lower to a 15-month low of 64.7 in February, weaker than expectations of no change at 67.8. Also, the U.S. February S&P Global services PMI unexpectedly fell to 49.7, weaker than expectations of 53.0. In addition, U.S. existing home sales fell -4.9% m/m to 4.08M in January, weaker than expectations of 4.13M. At the same time, the U.S. February S&P Global manufacturing PMI rose to an 8-month high of 51.6, stronger than expectations of 51.3.
“With policy uncertainty and weaker retail sales guidance [last Thursday] from consumer spending bellwether Walmart, we may have the catalyst we need for a healthy correction. However, there’s still a strong foundation in place for the bull market to continue,” said Gina Bolvin at Bolvin Wealth Management Group.
Meanwhile, U.S. rate futures have priced in a 97.5% probability of no rate change and a 2.5% chance of a 25 basis point rate cut at the March FOMC meeting.
Market participants will focus on earnings reports from several major companies this week, with semiconductor giant Nvidia’s (NVDA) report on Wednesday attracting the most attention. BofA analysts noted recently that the results will serve as the “next important test for AI bulls.” Retailers such as Home Depot (HD), Lowe’s (LOW), and TJX Companies (TJX), along with notable companies like Salesforce (CRM), Snowflake (SNOW), Zoom (ZM), C3.ai (AI), Dell Technologies (DELL), and HP Inc. (HPQ), are also set to release their quarterly results this week.
On the economic data front, the January reading of the U.S. core personal consumption expenditures price index, the Fed’s preferred inflation gauge, will be the main highlight this week. Market watchers will also be monitoring a spate of other economic data releases, including U.S. GDP (second estimate), the Conference Board’s Consumer Confidence Index, the S&P/CS HPI Composite - 20 n.s.a., the Richmond Fed Manufacturing Index, New Home Sales, Crude Oil Inventories, Durable Goods Orders, Core Durable Goods Orders, Initial Jobless Claims, Pending Home Sales, Goods Trade Balance, Personal Income, Personal Spending, Wholesale Inventories (preliminary), and the Chicago PMI.
Investors will also await further announcements from U.S. President Donald Trump regarding his plans to impose hefty trade tariffs.
In addition, several central bankers are scheduled to deliver remarks this week, including Logan, Barr, Barkin, Bostic, Schmid, Bowman, Harker, and Goolsbee.
The U.S. economic data slate is mainly empty on Monday.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.437%, up +0.38%.

Busy day today as we are loading back up on our pairs trades: /NG,HIMS, ZM, RIOT, HD, SPY/QQQ, Bitcoin, 0DTE's, AALD, BXMT, CADL, LUNG, CTLP, INOD, NTH, SWTX, ADVS, ASGN, CECO, BKE, BPMC, CBRL, CMPR, WWW.

My lean or bias on Friday was neutral. That was clearly off. I had been saying we had a big move incoming but clearly was caught off guard with Fridays move. Futures are up this morning. The 50DMA is key on the SPY/QQQ. If that holds I think bulls are fine. If we lose them? Certainly possible we get a down trend move. I'm slightly bullish today. The 50DMA's look like good support here and futures are rebounding. 

Let's take a look at our intra-day levels:
​/ES: With as much movement as we've gotten the last few days I'm pulling back to look at the 1DTE candles. 6077 is resistance and a move above that would get us back to bullish bias. 6022 is support and if we break that, I believe there is a lot more downside potential. 

/NQ:  The Nasdaq looks a little more worrysome. On the daily we've got 21,951 as resistance with 21,722 as support. That support level is close. If we break that we could see a move all the way down to 21,565.

BTC: Bitcoin continues to hold in a range. 96,545 is resistance with 94,576 acting as support. We've got a full day (0DTE) BTC trade on today vs. a 1HTE. 6% ROI potential if BTC stays below 97,750 today.

I look forward to seeing you all in the live trading room shortly! I will be a busy day with all the new pairs trades.