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Trading What I Preach: Lessons from a Chaotic FRYday in the ES
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Our View
Every day, every week, and every month so far in 2025 has been marked by extreme volatility, and FRYday was no exception. Just after the jobs report, the ES initially jumped, but in the hour leading up to the 9:30 regular session open, it sank.
Yes, I followed through with buying the open, and it was a successful trade. But after that, the ES dropped 105 points to a new low of 5673.00 and then rallied 116.50 points up to a new high at 5791 going into 4:00 close.
I’ve tried to keep my wits about the price action and traded what I preach. In fact, after exiting my opening buys at 5770.00, I posted this in the room:
IMPRO : Dboy : (Fri: 10:42:10 AM) : IMPRO : Dboy : (9:54:45 AM) : I think we are close to the early high
I got short at 5775, and the high was 5778. Not long after I posted, the ES started to fall. I later added this:
IMPRO : Dboy : (Fri: 11:55:30 AM) : Paid 5678.25 on 1 ES
IMPRO : Dboy : (Fri: 11:56:06 AM) : Gone down too much too fast.
I got out with a profit but again I didn’t hold long enough. No way did I think the ES was going back up to 5791 late in the day, but I did catch part of the late rip.
There are a lot of great traders in the MTS room, and no way do I compare to some of them. but if you asked them about my feel for the ES, they’d tell you I can call highs and lows, I just don’t hold as long as some of them do. I made good money, but sometimes I don’t practice what I preach and that’s when the ES starts going your way, you put your stop in and let it run, especially in these markets.
Recently, I’ve been talking about the inverted yield curve and how there has only been one occasion where the economy did not fall into a recession afterwards. One common denominator is when bank stocks and small caps fall while bonds and gold rally. It’s hard to deny that Wall Street is concerned about growth.
I think the public came into 2025 more optimistic than they had been at the end of 2024. However, trade tensions and slowing growth have dragged index markets lower over the past few weeks. If you need confirmation, just look at oil—it has fallen while safe havens like gold and Treasuries have surged. Meanwhile, the NASDAQ is down more than 10%. Plain and simple: investors are nervous after two consecutive years of 25% gains.
Clearly, government policies have shaken up the public. Yesterday, Trump said that he is confident that the country’s economy has a bright future, but he isn’t ruling out a 2025 recession just yet. He described this as a “period of transition” because what we’re doing is very big. We’re bringing wealth back to America. That’s a big thing.
If we do fall into a recession like I think we will, the Fed will start cranking up the quantitative easing (QE) program, just as it did during the 2008-2009 credit crisis and again during the COVID-19 pandemic. All told, the central bank purchased over $5.6 trillion in treasuries through its QE programs between 2008 and 2023 and that is where I think this is headed.
Our Lean
According to Jeffery Hirsch’s Stock Trader’s Almanac (@AlmanacTrader on Twitter), the Monday before the March Quad Witching has been up 26 of the last 37 occasions. Notably, on Thursday, February 20, 2020, the Dow lost 17.3% on the week ending 2/21/2020—the worst weekly point loss and the second-worst percentage loss overall. Historically, Friday, the March Quad Witching day has been mixed over the past 30 years, but the NW has been up 7 of the last 10 years. Here is a link to Jeff’s site: Stock Trader’s Almanac.
There are no scheduled economic releases today, but eight key reports are due later this week, including CPI and PPI on Wednesday and Thursday. There will be no Fed speakers.
I did a small survey of traders, and they believe the ES can push above 5800. It very well could, but that’s not going to cure the market’s ailments. Trump is now suggesting that tariffs on Canada and Mexico could increase, so I don’t think that picture is changing much. I don’t doubt that the ES could trade above 5800, but I’m sticking with the idea that all it will be is a dead cat bounce.
Our lean: I’m looking for a two-way trade but would be looking to sell. Resistance at 5817-5820, 5870.
MiM and Daily Recap
The S&P 500 futures (ES) experienced a dynamic session with notable volatility and strong directional moves. The market opened with a downward bias in the Globex session, setting the low of 5721.00 at 9:12 AM before rebounding sharply.
The regular session opened at 5726.25, and buyers quickly stepped in, pushing the market higher. By 9:54 AM, the ES hit an early session high of 5778.00, reflecting a 57-point gain (1.00%) from a premarket low. However, this rally was met with a retracement, leading to a pullback into midday lows hitting the low of the day at 11:51 am at 5673, down 105 points.
A 10-minute rally at 11:51 AM took price up 30.50 points only to falter and set a higher low at 12:18 of 4674. This initiated a sustained rally leading to a session high of 5790.25 at 2:21 PM—a 115.75-point gain (2.04%) from the prior low.
The late session saw another round of selling pressure, with the ES dropping to 5745.25 at 3:42 PM, before recovering into the final hour. The closing high was 5791.00 at 3:54 PM, though price slightly faded into the cash close of 5775.00, securing a daily gain of +48.75 points (+0.85%) from the open and up 27.25 from the previous settlement.
The overall market sentiment was bullish, driven by strong midday buying momentum. The ES established a clear uptrend after the morning lows, with higher highs and higher lows throughout the session.
The Market-On-Close (MOC) imbalance data revealed a $1.09B total imbalance, with the symbol imbalance leaning negative at -52.5%, suggesting broad-based selling pressure across individual stocks, despite the aggregate buy-side strength. The market is being more selective of what it wants to win.
Volume was healthy, with 1.8M contracts traded in the regular session, reflecting active participation by both institutional and retail traders. Total session volume was 2.2M shares.
The ES followed a textbook reversal pattern, with early session weakness giving way to a strong midday rally, topping out near 5790 before a controlled pullback into the close. The market held gains well, signaling resilience. Heading into the next session, traders should watch whether the bullish momentum sustains above 5775 or if sellers attempt to fade the recent strength.
Technical Edge
Fair Values for March 10, 2025:
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SP: 5.91
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NQ: 22.52
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Dow: 40.25
Daily Breadth Data 📊
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NYSE Breadth: 66% Upside Volume
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Nasdaq Breadth: 70% Upside Volume
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Total Breadth: 69% Upside Volume
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NYSE Advance/Decline: 56% Advance
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Nasdaq Advance/Decline: 56% Advance
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Total Advance/Decline: 56% Advance
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NYSE New Highs/New Lows: 36 / 71
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Nasdaq New Highs/New Lows: 53 / 215
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NYSE TRIN: 0.65
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Nasdaq TRIN: 0.52
Weekly Breadth Data 📈
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NYSE Breadth: 43% Upside Volume
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Nasdaq Breadth: 50% Upside Volume
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Total Breadth: 47% Upside Volume
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NYSE Advance/Decline: 31% Advance
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Nasdaq Advance/Decline: 31% Advance
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Total Advance/Decline: 31% Advance
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NYSE New Highs/New Lows: 158 / 359
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Nasdaq New Highs/New Lows: 194 / 875
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NYSE TRIN: 1.32
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Nasdaq TRIN: 1.03
Room Summaries:
Polaris Trading Group Summary Friday, March 7, 2024
Market Overview & Key Levels
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Market Context & Early Reactions
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The US jobs report was released pre-market, with unemployment at 4.1% (higher than forecast) and nonfarm payrolls at 151K (lower than expected).
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Initial market reaction was positive, but resistance was noted at the daily pivot, with bulls struggling to shift momentum.
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The key bull scenario outlined by PTGDavid held up early, with 5750 support leading to a 5785 target hit after the NFP report.
Key Trades & Execution
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Open Range Strategy played out across multiple instruments:
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Crude Oil (CL) – TGT 1 & TGT 2 filled
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Nasdaq (NQ) – Long target 1 filled
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S&P 500 (ES) – Long target 1 filled
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PTGDavid called this a “TRIFECTA” Open Range Strategy, highlighting its effectiveness.
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Price action commentary:
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Bulls attempted to absorb selling but struggled.
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Market turned into a “slug-fest,” with volatility creating opportunities but also challenges.
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By late morning, signs of weakness were clear, with bulls failing to sustain their moves.
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Key Lessons & Observations
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Precision in technical levels: PTGDavid’s pre-market plan of 5750 support leading to 5785 was spot-on.
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Adaptability in execution: After initial bullish moves, market weakness was identified, leading to caution for long trades.
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Risk management: Emphasis was placed on staying aligned with the market and managing risk as conditions became choppy.
Market Wrap-Up & Outlook
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PTGDavid wrapped up early, leaving charts online for traders.
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Late-day action saw bulls retreat, with Bud Fox “falling into the abyss,” signaling continued weakness.
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Sunday evening update: Market retested 5713, aligning with Cycle Day 1 projections. Bulls will need to hold and build a base on Monday to regain strength.
Final Takeaway
A strong start to the session with accurate technical calls, but resistance proved too strong. The Open Range Strategy delivered solid results, but the overall market weakness led to a shift in sentiment. Lessons in adapting to shifting conditions and respecting technical levels were reinforced.
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DTG Room Preview – Monday, March 10, 2025
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Stock Market Performance:
Last week saw a notable decline across major indices:-
S&P 500 fell over 3%
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Dow Jones dropped more than 2%
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Nasdaq slid almost 3.5%, officially entering correction territory (down over 10% from December highs)
Key Economic Updates:
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CPI and PPI inflation data are due this week; markets will analyze for tariff impacts.
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February jobs report showed 151,000 jobs added, slightly below expectations, while unemployment inched up to 4.1%.
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Markets still expect three Fed rate cuts in 2025, but the timing remains uncertain. No Fed speakers this week ahead of next week’s meeting.
Market Drivers:
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The recent selloff was driven by weaker economic data and concerns over tariffs.
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Morgan Stanley, JPMorgan, and Goldman Sachs have downgraded GDP forecasts, though none expect a recession—just slower growth.
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Corporate sentiment remains strong, with only 13 S&P 500 companies mentioning “recession” in their Q1 earnings calls. JP Morgan expects the S&P 500 to hit 5500 by June and 6500 by year-end.
Notable Stocks & Legal Developments:
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Capital One (COF) is facing a lawsuit from the Trump Organization over alleged political motivations behind a business decision.
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Earnings reports today include Oracle (ORCL), BNTX, and FNV.
Market Conditions & Technicals:
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Volatility remains high, with the ES 5-day average daily range around 138 points.
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No clear large trader bias overnight.
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S&P 500 (ES futures) tested the bottom of its short-term downtrend channel on Friday.
Other Notes:
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U.S. traders should note that daylight savings time started Sunday, meaning U.S. market sessions now open one hour earlier for non-U.S. participants.
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ES Week vs. Week
The bull/bear line for the ES is at 5758. This is the key level that needs to be reclaimed for any bullish momentum to resume. Above this level, we look for potential buying opportunities on dips.
Currently, ES is trading around 5707.25, indicating weakness below the bull/bear line. If the price remains below this level, expect further downside pressure, with targets at 5687.59 and 5671.75, which is our lower range target for the day. A break down below these levels could extend the decline towards 5590.
On the upside, resistance comes in at 5791 and 5845, our upper range target. If ES can reclaim 5758.4 and hold above it, then a test of these resistance levels is likely. Bulls need to establish strength above 5845 to confirm a potential reversal.
Overall, the trend remains bearish below 5758, and caution is warranted until this level is reclaimed. The longer-term bull/bear line has crept lower to below 6,000 and sits at 5984. If/when prices print above this level we would move to a more bullish sentiment.
NQ Week vs. Week
The bull/bear line for NQ is now at 20,148. This is the key level that determines the intraday market’s bullish or bearish momentum. Staying below this level suggests continued weakness, while a break above could open the door for a recovery.
Currently, NQ is trading at 19,979, showing significant downside pressure. The immediate downside target is 19,697, our range low target on the day. If that level fails to hold, we could see a deeper move toward 19,378.
On the upside, resistance is seen at 20,148 followed by 20,229. A move above these levels would suggest a potential bounce toward 20,544, which is a key target for bulls and our range high target for the day.
Given the recent bearish structure, bulls need to reclaim 20,148 and sustain above it to shift momentum. Otherwise, the path of least resistance remains downward.
Our long-term bull/bear line now sits at 21,394.
Calendars
Economic
Important events for the rest of the week:
S&P 500 Earnings
Recent
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Disclaimer: Charts and analysis are for discussion and education purposes only. I am not a financial advisor, do not give financial advice and am not recommending the buying or selling of any security.
Remember: Not all setups will trigger. Not all setups will be profitable. Not all setups should be taken. These are simply the setups that I have put together for years on my own and what I watch as part of my own “game plan” coming into each day. Good luck!
This post goes out as an email to our subscribers every day and is posted for free here around 2 PM ET. To get your real-time copy, sign up for the free or premium version here: Opening Print Subscribe.
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