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From Collapse to Comeback: ES 450-Point Reversal
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Our View
You know that old saying, “You can’t make this stuff up?” Well, you can’t! The ES and NQ were unhinged. I think we can all agree that we’ve never seen anything like what we’ve been seeing—like the 419-point rally in less that 30 minutes, or for that matter, the 210-point drop last Wednesday when Trump announced the new tariffs.
I compare this to the credit crisis but 5x. The bots have taken over, and it’s non-stop. The PitBull called me while the ES was making its Sunday night move—he had big positions on and said, “I need your help. What do you think of the ES?” I said I think they go back to 5120, that the ES went down too much, too fast.
I’m not sure why they really rallied 454.5 points up to 5286.50, but this was part of it: HASSETT: TRUMP IS CONSIDERING A 90-DAY PAUSE IN TARIFFS FOR ALL COUNTRIES EXCEPT CHINA. Bill Ackman did a tweet saying he thought it would be a good idea to give a 90-day reprieve, so it was already built into the price action.
After the rally really kicked into gear, the ES was moving in 10- and 15- to 20-point clips. Like I said yesterday, there are no ticks—it’s points, and a lot of them. In order to buy, you had to step up 10 points, and even then the ES was already above the price.
The VIX made its high on the open at 60.13. You could feel how everything was pinned down and that something was going to give, and there was over 1 million ES traded on Globex. After some big ups and downs, the ES and NQ sold off late and then started to rally again. It was an amazing day of huge up and down moves, but it didn’t go without some headlines along the way, and here are just a few:
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A bogus rumor that President Donald Trump was considering a pause in tariffs briefly lifted markets Monday before the White House shot down the unfounded reports.
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The Trump administration is quietly debating the creation of a new exporter tax credit, a move that signals growing internal concern over the economic costs of the White House’s sweeping tariff policies.
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US Treasury Secretary Bessent: Trump will be directly involved in Japan trade talks.
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US Treasury Secretary Bessent: Maybe 70 countries have approached the US by now on trade.
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Trump: “If China does not withdraw its 34% increase above their already long-term trading abuses by tomorrow, April 8th, 2025, the United States will impose ADDITIONAL Tariffs on China of 50%, effective April 9th.”
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JPMorgan’s Jamie Dimon warns we are entering a period of “considerable turbulence,” and today’s decisions may determine which companies sink or swim.
This is just a small example of the headlines—they were fairly constant throughout the day. After the late pullback and a $1.3 million buy imbalance, the ES rallied 58 points.
Our Lean
China’s Nuclear Suitcase
China could really stick it to the US if they wanted to. They hold approximately $760.8 billion in U.S. Treasury securities, and recently, China sold $50 billion in bonds and increased bond yields. This action follows President Trump’s announcement of potential increased tariffs on Chinese imports if China does not lift its retaliatory tariffs. Discussions on social media speculate about the implications of China’s actions on both the U.S. and Chinese economies.
Maybe I’m wrong and all this tariff stuff is just not going to go away. Maybe if Trump does give a tariff reprieve, we continue to go up—but that doesn’t mean the decline is over. Like I said, two or three days of up, and a slightly better CPI could be the next part of the next leg up.
Our lean: things are really fluid and can change on a dime. Just because the ES rallied, it doesn’t mean you’re supposed to drop your guard, as the crazy volatility will persist.
There are a lot of folks out there who are concerned about their 401k or retirement accounts, and the way the market sold off—they should be. I can’t rule out selling a big gap open, but what’s been happening is the ES has been well off its high or low before the 9:30 open. Ideally, I am looking to buy the pullbacks.
The consumer is tapped out too:
https://www.zerohedge.com/markets/6-sigma-miss-consumer-credit-confirms-us-consumer-finally-down-and-out
MiM and Daily Recap
The ES session kicked off with early volatility during the tail end of Globex. After a weak overnight showing, the market hit a low of 4958.00 at 8:18 AM before bouncing to 5028.00 by 8:30 AM. This was followed by a sharp selloff into the regular session open, establishing the session low at 4867.00 by 9:42 AM.
Panic buying began as a misquote from Director of the National Economic Council, Kevin Hasset, about rolling back tariffs hit the tape and launched the ES up a staggering 419.50 points to reach the high of the day at 5286.50 by 10:15 AM. However, this vertical move was quickly faded as the market realized the rumor was false, with the index retracing to a low of 4987.25 at 10:19 AM.
The market then began a sequence of lower highs and higher lows, indicating indecision. A midday rally carried ES up to 5150.00 by 11:03 AM and then to 5091.25 at 11:42 AM before fading to a low of 5000.25 at 12:21 PM. Another bounce to 5068.75 at 12:33 PM was met with selling pressure again, marking a minor low of 4996.75 by 12:57 PM.
In the afternoon, buyers regained momentum, lifting ES to 5158.00 at 2:21 PM—another local high. This was followed by a dip to 5052.75 at 3:15 PM before one final attempt higher into the close that topped out at 5145.75 at 4:15 PM. The regular session ended at 5098.75, up 157 points or 3.18% from the open.
From a broader perspective, the full session rose 111 points (+2.22%) from the prior full session close ending at 5118.00. This gain was primarily driven by regular session strength, which offset the -1.30% drop seen during Globex.
The tone throughout the session was broadly bullish, despite an initial plunge in Globex and early volatility. The rally off the morning low was aggressive and extended, but gains were met with heavy intraday chop as the session wore on. The inability to reclaim the 10:15 AM high and the series of fading afternoon highs signaled profit-taking and a possible shift to short-term consolidation.
Volume was robust, with 2.33 million contracts trading during the regular session and over 3.5 million on the day.
Market-on-Close (MOC) data showed modest inflows, with a total imbalance of $176M to buy, but neither the dollar (53.3%) nor symbol (55.1%) imbalance exceeded the 66% threshold for strong conviction. The imbalance peaked at 3:59 PM with a slight uptick in buy programs, helping cushion prices into the close.
Overall, the day closed on a firm note, with bulls defending the 5100 handle. While the uptrend from the morning low remains intact, the intraday reversals and failed retest of highs suggest a possible pause ahead. The next session may hinge on whether buyers can build on this momentum or if sellers take advantage of stretched short-term conditions.
Technical Edge
MrTopStep Levels:
Fair Values for April 8, 2025:
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SP: 44.36
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NQ: 175
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Dow: 282.17
Daily Market Recap 📊
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For Monday, April 7, 2025
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NYSE Breadth: 33% Upside Volume
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Nasdaq Breadth: 50% Upside Volume
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Total Breadth: 45% Upside Volume
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NYSE Advance/Decline: 21% Advance
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Nasdaq Advance/Decline: 32% Advance
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Total Advance/Decline: 28% Advance
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NYSE New Highs/New Lows: 1 / 1,162
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Nasdaq New Highs/New Lows: 36 / 1,611
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NYSE TRIN: 0.50
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Nasdaq TRIN: 0.47
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Weekly Market 📈
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Week ending Friday, April 4, 2025
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NYSE Breadth: 34% Upside Volume
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Nasdaq Breadth: 42% Upside Volume
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Total Breadth: 39% Upside Volume
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NYSE Advance/Decline: 7% Advance
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Nasdaq Advance/Decline: 14% Advance
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Total Advance/Decline: 12% Advance
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NYSE New Highs/New Lows: 106 / 1,073
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Nasdaq New Highs/New Lows: 150 / 1,682
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NYSE TRIN: 0.74
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Nasdaq TRIN: 0.89
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Trading Room Summaries
Polaris Trading Group Summary – Monday, April 7, 2025
Positive Trades and Highlights:
Overview:
Monday kicked off with heightened volatility and heavy volume as traders reacted to geopolitical headlines and market uncertainty. Despite the chaos, the PTG room navigated the action with precision, capitalizing on multiple opportunities and demonstrating excellent adaptability throughout a consolidation-heavy session.
Key Trades & Highlights:
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Early Strategy: PTGDavid identified the 4950–4960 range as a key pivot zone. As anticipated, market open volatility gave way to precise execution.
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OPR Trifecta Wins:
✅ CL OPR short hit 2 targets early.
✅ NQ OPR shot filled its target.
✅ These wins marked a strong start and highlighted the effectiveness of the Open Range Playbook. -
Market Reaction & Reversal:
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News-driven whipsaws dominated the day — from initial sell-offs (fueled by fears over tariffs) to sharp reversals.
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Notably, the market rocketed 200 points in 5 minutes, creating incredible scalp opportunities. CurlyTrades reported monster scalps: +51 and +73 on NQ — usually a mere 8-pt target. 👏
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Humor & Education:
PTGDavid kept the room light with fictional tales of Herb & Marge blowing up accounts and poking fun at Cramer’s infamous reverse signals — but underlined key lessons about following sound strategy over media narratives. -
Market Psychology & Risk Management:
Emphasis was placed on trading small (e.g. 1 MNQ contract) and using hard stops due to extreme speed and potential slippage in fast conditions.
PTGDavid reminded traders to “Be nimble, be quick… or get burned jumping over the candlestick!” -
Key Levels & Observations:
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ES 5150 and NQ 17800 emerged as critical levels bulls needed to reclaim and hold.
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Initial attempts at 5150 failed but formed the basis for bulls to battle back later in the session.
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Price oscillated around VWAP during midday, showcasing a textbook balancing day.
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MOC Drama:
Late session saw a $4.7B MOC sell imbalance ($4.2B in NAZ), which flipped to a buy, triggering a mild ripper into the close. While bulls gained late ground, the close was still part of a broader consolidation pattern.
Lessons Learned:
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News Moves Markets, But Structure Wins:
Despite conflicting headlines (e.g. tariff pause fake news), PTG traders stuck to their levels and structure, which paid off. -
Scalp Smart in Fast Markets:
Big ranges = big opportunity, if you size appropriately and honor your stops. -
Stay Flexible:
PTGDavid’s mid-morning shift from sell to buy-side lean showed the importance of adapting to emerging price action rather than marrying a bias. -
Closing Insight:
PTGDavid summarized it best: “Today was a balancing/consolidation day…Tomorrow’s action will be more telling.” The bid into the close offered hope for bullish continuation, but caution remains warranted.
Final Thought:
A powerful Monday session — with volatility, opportunity, and great community banter. Solid trading discipline kept many in the green. The table is set for Tuesday, and the PTG team is ready.
Discovery Trading Group Room Preview – Tuesday, April 8, 2025
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Key Market Themes
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Tariffs Dominate Headlines: Trump threatens +50% tariffs on China if they don’t remove retaliatory duties. China vows to “fight back.”
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Mixed Messages from D.C.: While some officials push for diplomacy (e.g., Japan talks), others continue aggressive posturing.
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Big Names Push Back:
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Jamie Dimon, Larry Fink, Bill Ackman, Stanley Druckenmiller, and Elon Musk warn of economic fallout.
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Ackman criticizes tariff calculations, Musk slams Peter Navarro’s credibility.
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Druckenmiller publicly opposes tariffs over 10%.
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Global Reactions
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Uncertainty abroad: Countries like Vietnam (hit with 46% tariffs) are unsure what can be negotiated.
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Trade deficit dilemma: U.S. can’t easily scale up production or compete in low-cost manufacturing.
Market Action & Levels
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Volatility spiking: ES 5-day ADR hits 284.25 points – extreme levels that may begin to contract.
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Technical note: Former ES downtrend channel bottoms acted as resistance in Monday’s bounce.
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Whale bias: Bullish heading into the U.S. session.
Today’s Calendar
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Earnings: RPM International (RPM) reports premarket.
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Fed Speak: San Francisco Fed’s Mary Daly at 2:00pm ET.
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No major data releases on the economic calendar.
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ES -Week to Week
The bull/bear line for the ES is at 5094.50. This is the critical pivot level for today. Holding above this line may allow for bullish continuation; however, continued rejection below signals bearish control.
ES is currently trading around 5174.25, showing strength above the bull/bear line. If the price can stay above 5094.50, the upper range target comes into play at 5293.75. A breakout above this level could open the path toward resistance at 5387.25 and possibly 5481.25.
To the downside, if ES slips back below 5094.50, look for support at 5007.00 and then at 4895.25, the lower range target. A breakdown below that may bring 4832.00 and even 4707.75 into focus as key support levels.
Overall, the sentiment leans bullish while ES holds above 5094.50. Watch for price action near 5293.75 to assess continuation or potential rejection.
NQ – Week to Week
The bull/bear line for NQ is at 17,541.50. This is the critical level that separates bullish from bearish sentiment today. As long as price stays below this mark, sellers remain in control. A reclaim and hold above it could shift momentum in favor of the bulls.
Currently, NQ is trading around 17,812.75, showing some strength above the bull/bear line. If buyers can hold this area, the next upside target is 18,350.30, our upper range target. Beyond that, resistance sits at 18,569.00 and then at 19,111.50.
On the downside, if NQ fails to hold above the bull/bear line, look for a drop toward 17,100.80 and potentially down to 16,732.80, which is our lower range target. Continued weakness below that could expose 16,460.00 and the more extended support zone near 15,971.50.
The chart shows a large previous candle range, so be prepared for wide intraday swings. Use the bull/bear line as your directional pivot.
Calendars
Economic Calendar
Today
Important Upcoming
Earnings
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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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