Market analysis for April 17th, 2025

Peace

Good Thursday to you all! As we prepare to finish off this holiday shortened trading week I want to wish all of you peace and joy in your life. Whether you are Christian or not, Good Friday and Easter can be a time for all of us to reflect on the blessings life gives us. I'm grateful for the many friends I've made through trading. I'm also grateful that I'm only three, budget smashing payments away from completing my payments to the trading compound in Costa rica that I've been working on for over a year to provide us a place to come and trade and enjoy each others company. I am really looking forward to that.

Let's get into our day yesterday.  We sowed a lot of seeds yesterday. Now we need to harvest. With the big sell off from Powells speech we needed to roll our /NQ covers on our short /MNQ futures position out and down to today. Those are currently 260 points OTM and up $900 dollars with $800 extrinsic. It's likely we could get a $1,700 payday today from our bearish scalp. Our SPX brought in a bit of income from the broken wing butterflies which kept my debit to just -$1,450. We rolled the ITM puts to today and with futures up this morning we have lots of options. We could turn it into a completely risk-free box spread which would lock in a $800 gain and then continue to work to hopefully get more than $1,450 out of it. We'll see how the day opens up but it looks like a solid roll. Sometimes a roll is just kicking the can down the road because you just didn't want to pull the band-aid off! This roll looks pretty good. It's tough to get a completely risk-free box trade on but they are pretty neat when you can. The risk graph looks different when you have no risk!
Here's a look at our day yesterday. 

June S&P 500 E-Mini futures (ESM25) are up +0.59%, and June Nasdaq 100 E-Mini futures (NQM25) are up +1.02% this morning as positive signals from the first round of U.S.-Japan trade talks boosted sentiment.
U.S. President Donald Trump said there was “big progress” in talks to secure a deal for Japan. This fueled optimism that deals can be struck to avoid higher tariffs on U.S. trading partners.
.-Japan trade talks will continue to be closely monitored, not just for their bilateral implications, but also as a potential framework for how the U.S. may approach trade relationships with other allies,” said Rajeev De Mello, a global macro portfolio manager at Gama Asset Management.
Futures linked to the tech-heavy Nasdaq 100 outperformed as U.S. chip stocks gained ground in pre-market trading after the world’s biggest contract chipmaker, Taiwan Semiconductor Manufacturing Co., reported better-than-expected Q1 profit and provided an upbeat Q2 sales forecast.
Investors now look ahead to a fresh batch of U.S. economic data and an earnings report from streaming giant Netflix.
In yesterday’s trading session, Wall Street’s three main equity benchmarks closed lower. Nvidia (NVDA) sank over -6% and was the top percentage loser on the Dow after the Trump administration barred the company from selling its H20 chip in China. Also, J.B. Hunt Transport Services (JBHT) slid more than -7% and was the top percentage loser on the S&P 500 after the transportation and logistics company logged lower Q1 profit and revenue. In addition, Advanced Micro Devices (AMD) slumped over -7% and was the top percentage loser on the Nasdaq 100 after the company said it expects to face charges of up to $800 million after the U.S. government limited exports of its MI308 chip to China. On the bullish side, Travelers Cos. (TRV) rose more than +1% and was the top percentage gainer on the Dow after the insurer posted better-than-expected Q1 core EPS.
Economic data released on Wednesday showed that U.S. retail sales jumped +1.4% m/m in March, stronger than expectations of +1.3% m/m. Also, U.S. March core retail sales, which exclude motor vehicles and parts, rose +0.5% m/m, stronger than expectations of +0.4% m/m. In addition, U.S. industrial production fell -0.3% m/m in March, weaker than expectations of -0.2% m/m, while manufacturing production rose +0.3% m/m, in line with expectations.
Fed Chair Jerome Powell said on Wednesday that the central bank needs to make sure tariffs do not lead to a more persistent rise in inflation. “Our obligation is to keep longer-term inflation expectations well anchored and to make certain that a one-time increase in the price level does not become an ongoing inflation problem,” Powell said. The Fed chair reiterated that policymakers are in no hurry to cut interest rates when he said, “For the time being, we are well positioned to wait for greater clarity before considering any adjustments to our policy stance.” Also, Cleveland Fed President Beth Hammack said there is a strong rationale for policymakers to keep interest rates steady until more clarity emerges on how tariffs and other policy changes will affect the U.S. economy.
“Many had assumed that the Fed would prioritize the labor side of the mandate if forced to choose, but he suggested that price stability is necessary to maintain a healthy labor market,” said Adam Phillips, managing director of investments at EP Wealth Advisors.
U.S. rate futures have priced in an 86.5% chance of no rate change and a 13.5% chance of a 25 basis point rate cut at the May FOMC meeting.
First-quarter corporate earnings season picks up pace, and investors look forward to new reports from prominent companies today, including Netflix (NFLX), UnitedHealth Group (UNH), Charles Schwab (SCHW), and DR Horton (DHI). According to Bloomberg Intelligence, companies in the S&P 500 are expected to post an average +6.7% increase in quarterly earnings for Q1 compared to the previous year.
On the economic data front, investors will focus on the U.S. Philadelphia Fed Manufacturing Index, which is set to be released in a couple of hours. Economists, on average, forecast that the April Philly Fed manufacturing index will stand at 2.2, compared to last month’s value of 12.5.
Investors will also focus on U.S. Initial Jobless Claims data. Economists expect this figure to be 225K, compared to last week’s number of 223K.
U.S. Building Permits (preliminary) and Housing Starts data will be released today as well. Economists expect March Building Permits to be 1.450M and Housing Starts to be 1.420M, compared to the prior figures of 1.459M and 1.501M, respectively.
Meanwhile, the U.S. stock markets will be closed tomorrow in observance of Good Friday.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.314%, up +0.82%.

Our task today is pretty straightforward. Squeeze as much as we can out of the SPX. Hopefully more than $1,450 so we can have an overall profit. Lock in the /NQ gain on our scalp or, roll it out and down if we get more bearish price action today. If we book our scalp profit today we'll need to assess our short /MNQ and whether we want to continue being short over the extended weekend.

Let's look at the markets:
Theres really no resolution to the big question of when the bulls will return. 

Technicals are still bearish. Surprise, surprise.  I'll likely continue to hold our short scalping position into next week.

 I was bullish yesterday off the lows of the futures session and that worked until Powell started speaking. Shocker. I'm leaning bullish again today. Our SPX put roll from yesterday needs to finish above 5290 for max profits so we would benefit with a slightly bullish day. If we drop again today that's ok too. We would increase our profit potential on our short Scalp and could turn the SPX into a risk-free box spread and then work some more legs into it.

I'm looking at the 1HTE's this morning and there is just not enough movement to get good risk/reward so I'll skip those today. We aren't working the NDX today as there are no options so I'll focus on the /ES.
/ES: Surprise! Levels today are the exact same we had yesterday. The market churns higher then lower but there's no real change in directional bias. 5339 is VWAP on the 2hr. chart and a key level. If we can stay above that level it would be a much easier day for us with our rolled SPX puts. Next up on resistance would be 5393. Support is all the way down at 5262. That would neccesitate another roll, out and down on our short /MNQ scalp cover.

We rolled a lot of potential profit yesterday into today. Let's see how much of it we can actually put in our wallets today. I look forward to seeing you all in the trading room shortly.