S&P 500 Daily Update for March 6 2025

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Market Overview (Wednesday, March 5th):
Stock Market Performance: The S&P 500 and NASDAQ 100 remained above their 200-day moving averages, a key long-term support level. The market opened flat despite strong overnight futures and positive European markets, drifting lower initially but finding support at 5,750 (S&P 500). Prices later rose, closing slightly below the R1 pivot at 5,851, up 1.12% on above-average volume.
Internal Conditions: Short-term (20-day) and intermediate-term (50-day) trends remain negative, while the long-term trend (200-day) is positive. Momentum indicators show some improvement but are still oversold or negative in the short and intermediate term.
Volatility: The VIX closed above 20 (21.93), indicating persistent fear in the market, though it ticked down slightly. Sentiment remains extremely pessimistic (below 25 level), which could signal a potential reversal if it shifts.
Economic Factors: Interest rates rose slightly (10-year yield at 4.27% from 4.21%), pressuring stocks, while the U.S. dollar weakened significantly, potentially stabilizing stocks. President Trump’s tariff policies, including a one-month exemption for auto tariffs under the USMCA, influenced market dynamics.
Key Economic Reports (Wednesday Results):
MBA Mortgage Applications: Up 20.4% (vs. -1.2% prior), possibly due to declining interest rates.
ADP Employment Change: Disappointing at 77,000 jobs added (vs. 186,000 prior and 154,000 expected), raising economic weakness concerns.
ISM Services: Stronger than expected at 53.5 (vs. 53 forecast), signaling expansion.
Factory Orders: Up 1.7% (vs. 1.3% expected), a positive surprise.
Market Drivers and Sentiment:
Tariffs and Policy: Trump’s address to Congress and tariff adjustments contributed to market optimism, though this could shift quickly.
Hindenburg Omen: An initial signal triggered after March 3rd; a second signal within 20 trading days (by late March) would confirm a bearish outlook.
Sector Performance: Growth areas (tech, discretionary, communication) outperformed, while defensive sectors (utilities, energy) lagged.
Outlook for Thursday, March 6th:
Economic Reports: Key employment-related data incoming—initial jobless claims, continuing claims, trade balance, productivity, unit labor costs, and wholesale inventories—could sway markets.
Friday’s Employment Situation Report: A major catalyst that may determine if markets improve, chop sideways, or decline further.
Technical Levels: Maintaining above the 200-day moving average remains critical. A close below could turn the long-term trend negative.
Seasonality: Historical data suggests a neutral-to-negative bias for March 6th, with post-election years showing choppiness in March but potential improvement later.
Conclusion:
The market showed slight improvement on Wednesday but remains negative in the short and intermediate term, with short-term momentum indicators mixed. The long-term outlook remains positive as long as the S&P 500 and NASDAQ 100 hold above their 200-day moving averages. Thursday’s economic data and Friday’s jobs report will be pivotal in determining the next direction. Sentiment is pessimistic, and volatility persists, but stabilizing factors such as a weaker dollar and tariff adjustments may offer some support.
PDF of Charts and Slides used in today's video:
https://drive.google.com/file/d/1ODHCw9CaZVl4PWdCf4ESLS3bgB_374sL/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!