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Amazon’s AI Revolution and the Market’s Uneasy Calm
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Our View
The ES traded in a 21.75-point range on Globex, from a high of 6785.00 to a low of 6763.25, on low volume of 138k contracts. It opened Tuesday’s regular session at 6774.25, traded 6774.75, and then pulled back to the 6769.75 low at 9:31. It then sold off down to 6766.50 at 9:40, traded back up to a new high at 6777.50, and then sold off again to a new low at 6759.00 at 10:00, as the 10-year note and gold tumbled.
After the low, the ES rallied up to a new high at 6778.50 at 10:22, then sold off down to a higher low at 6761.75. It then rallied 25.75 points up to 6787.50 at 11:12, sold off down to another higher low at 6773.50 at 11:40, and then rallied 16.25 points up to 6789.75 before dropping 22.5 points down to 6767.25 at 1:03.
After that drop, the ES rallied back up to 6781.50, pulled back to the 6770.00 level, and then rallied back up to 6785.00 at 2:44. It sold off down to a 6776.50 double bottom, rallied to 6782.50, and then sold off to 6776.25 at 3:36. The ES traded up to 6780.50 at 3:48 and traded 6780.25 as the 3:50 imbalance came out showing a $350 million sell. It then traded 6784.00 at 3:54 and dropped to 6772.00 on the 4:00 cash close.
The ES does not usually drop 12 points in a minute before the cash close, but I think someone got a lead on the NFLX earnings and dropped the ES 7 points down to 6765.00 at 4:03. It bounced up to 6773.25 and settled at 6773.25, down 0.50 points or -0.01%.
The NQ traded up to 25,344.00, dropped down to 25,286.50, then traded up to 25,298.50 on the 4:00 cash close before selling off down to 25,228.75. It rallied back up to 25,271.00 and settled at 25,294.75.
In the end, the ES and NQ both fell short of new contract highs, and gold suffered its largest drop in more than a decade.
In terms of overall tone, the ES and NQ acted firm until the cash close. As for overall trade, volume was on the low side with a daily total of 1.247 million, and only 1.05 million contracts traded during the day session.
The High Cost of AI
Well, my super-duper AI levels weren’t so super after all, and when I went back to Grok for my saved coding program, it said it was not available. That doesn’t mean I’m not going to keep trying, but like I said yesterday, I could never compile the different indicators and manually code the support and resistance levels myself.
But that brings me to my point: AI is doing a lot of things humans can and can’t do—and today’s story is about Amazon’s plan to let go of 600k employees and replace the workers with AI robots.
The NY Times broke the story at 12:21, but it didn’t go mainstream until around 4:00 a.m. The Times reported that internal Amazon documents suggest the company is looking into building and using more robots to replace human workers. The publication doesn’t specify if this will result in massive layoffs. However, the robots would allow Amazon to avoid hiring new workers to meet increasing demand, translating to 600,000 jobs replaced by 2033, according to the report.
The report also says the company wants to mitigate the fallout in communities that may lose jobs. Documents show the company has considered building an image as a “good corporate citizen” through greater participation in community events such as local parades and Toys for Tots.
And the leaked documents discuss avoiding the use of terms like automation and AI, instead using phrases such as “advanced technology,” and replacing the word “robot” with “cobot” to suggest collaboration.
“Leaked documents often paint an incomplete and misleading picture of our plans, and that’s the case here,” an Amazon spokesperson said in an email. “In this instance, the materials appear to reflect the perspective of just one team and don’t represent our overall hiring strategy across our various operations business lines—now or moving forward.”
There were 818k downward jobs revisions, and looking at the current outlook combined with AI-created job loss, it’s hard for me to imagine seeing explosive job growth in the future. I’m not saying there won’t be some improvement in the job sector—it just may take more time than the economy would like.
U.S. Nonfarm Payroll Employment Changes by Month for 2024 and 2025
Below is a comprehensive list of monthly nonfarm payroll employment changes (in thousands, seasonally adjusted) for 2024 and 2025, based on data from the Bureau of Labor Statistics (BLS) Current Employment Statistics (CES) survey.
The 2025 data incorporates the latest revisions, including the 818,000 downward revision from the preliminary benchmark adjustment announced on August 20, which affects the total employment level for the 12-month period ending March 2025 (covering April 2024–March 2025).
For 2024, the data reflects final or near-final figures, as most revisions have been incorporated. For 2025, data through September is available, with October data pending (due November 1).
On Tap
Wednesday, 4:00 PM – Fed Governor Michael Barr speaks
Our View
Gold (GCZ25:CME) sold off down to 4,093.00 and settled at 4,109.10, down 250.3 points or -5.74%. Bitcoin (BTCZ25) rallied 1,025 points up to 115,500 and settled at 113,345, up +1,025 points or +0.91% on the day session. But at 9:35 PM ET, the future is trading 109,605, down 3,740 points or -3.30% on Globex.
Spot Bitcoin ETFs saw $1.23 billion in outflows this week—the largest since early summer—with BlackRock’s iShares Bitcoin Trust (IBIT) alone losing $100.65 million on October 20. Ethereum ETFs fared worse, with $145.68 million in redemptions.
While the recent drop is big in dollar terms, it pales in comparison to the $18 billion retail lost on Bitcoin. I look at it like this: everything has gone too far. There are extremely high stock valuations, extremely high precious metal prices and cryptocurrencies, extremely low oil and grain prices, extremely volatile foreign exchange and treasuries, and when you throw in the government shutdown and Trump’s Foghorn Leghorn tariff approach, it all adds up to an extremely volatile tape.
To tell the truth, it’s unlike anything we have ever seen.
Our Lean
As you know, I am a bull market guy. There are some basic trading rules that, if you follow them, improve your chances of being profitable.
The first is the number one rule of all time: the trend is your friend. I know it sounds simplistic, but it’s 100% spot on—you make better money trading when you can define the direction or when the markets are trending. Since the April 7 lows, every decline has been met with a higher high. Every 50-point drop to 300+ point drop has been bought.
I understand that when you trade futures, a good trader should be able to navigate going long and short—but no matter how good, you will get caught short when the ES and NQ are going up. So that’s when trend really is your friend.
Our lean: I can’t say for sure that the ES and NQ won’t sell off again after yesterday’s weak earnings, but I think there is a reason why the ES and NQ keep going up: the Fed’s rate cut.
Trump has literally made a mandate to lower interest rates, and now Powell is fully on board, and tech is riding the wave. My gut says to keep buying the pullbacks, and when the ES and NQ do sell off, be on the lookout for a retest or higher low.
I think the moral of the story is: under proper conditions, I can’t rule out selling the early rallies—but the money trade is buying the dips. The ES has been higher 4 out of the last 7 sessions with substantial gains, while two of the three down days were only -0.12% and -0.01%. Looks like a big back and fill to me.
Foreign Stock Flows Into U.S. Markets
#Kobeissi #US #Foreign #Stock #Flows
According to The Kobeissi Letter, foreign investors have been pouring into U.S.-listed stocks in recent months, with inflows reaching $22 billion so far in October. This is reportedly the highest monthly figure since June, based on data from Goldman Sachs.
The letter also notes this marks the third consecutive monthly inflow, bringing the year-to-date total to a net $316 billion.
Additionally, the post states that foreign holdings of U.S. equities rose to a record $20 trillion last quarter, concluding that “Everyone wants to enter the U.S. stock market.”
Guest Posts — Polaris Trading Group
S&P 500 (ES)
PPrior Session was Cycle Day 2: “The Battle of 6765″
Battlefield Report
Overnight action dipped straight into the Line in the Sand — 6765, where the defending bulls immediately countered. That level, defined early in the DTS Briefing, became the tactical anchor for the entire session.
By midmorning, @PTGDavid’s A4 short probe quickly turned into a LIS reclaim long, aligning perfectly with MATD BTFD protocol.
🖼️ A4/A10 Trade Sequence Screenshot
Both A4 and A10 longs paid beautifully as the 6765 trench held. A textbook CD2 balance day unfolded — a classic “pause to refresh” after yesterday’s trend expansion.
Range was 30 handles on 1.246M contracts traded.
For greater detail of how this day unfolded, click on the Trading Room RECAP 10.21.25 link.
…Transition from Cycle Day 2 to Cycle Day 3
Transition into Cycle Day 3: Three-Day Cycle Target 6772.50 has been fulfilled, so with price above the CD1 Low (6694) the cycle statistic appears secured (91.61%)
Bulls continue to “OWN” this market for the time being, as the “trading weather” can change in an instant. So always have your fowl-weather gear handy.
We’ll mark today as a “wild-card” for direction as a brief consolidation following an uptrend can easily re-assert itself.
***side-note: The Metals Complex experiencing a sudden shock lower: Gold plunged for its biggest loss (-6.43%) in more than 12 years….Silver suffers -8.24% decline…Platinum suffers biggest decline in (-6.33%) 5.5 years.
Of course, nothing changes for PTG…Simply follow your plan. Take only Triple A setups and manage the $risk. ALWAYS HAVE HARD STOP-LOSSES in-place on the exchange.
PTG’s Primary Directive (PD) is to ALWAYS STAY IN ALIGNMENT with the DOMINANT FORCE.
As such, scenarios to consider for today’s trading.
Bull Scenario: Price sustains a bid above 6785+-, initially targets 6795 – 6800 zone.
Bear Scenario: Price sustains an offer below 6765+-, initially targets 6755 – 6750 zone.
PVA High Edge = 6785 PVA Low Edge = 6670 Prior POC = 6780
ESZ
Thanks for reading, PTGDavid
MiM and Daily Recap
Intraday Recap
The ES opened Tuesday’s Globex session at 6779.50 and initially traded higher, reaching 6782.75 by 19:10 before a small pullback to 6776.00 at 20:00. A second push carried the futures to an overnight high of 6785.00 at 22:30, marking a modest 9.00-point gain (+0.13%) from the prior swing. Sellers then stepped in, pressing the ES down to 6763.25 at 04:10, its Globex low, representing a 21.75-point drop (-0.32%) from the high. A mild recovery followed into the morning, reaching 6778.00 at 07:10 before easing again into the 9:30 cash open at 6774.25.
The regular session began with a minor uptick to 6777.50 at 9:35 but failed to hold gains, retreating to 6759.25 by 10:00. Buyers reemerged, lifting the ES steadily to 6787.25 at 11:10, a 28.00-point climb (+0.41%) from the morning low. The advance paused briefly, producing a higher low at 6773.75 by 11:35 before extending to a new intraday high at 6789.75 at 12:45. From there, momentum faded sharply as sellers drove prices down 22.5 points to a fresh session low of 6767.25 at 13:00 (-033%). A rebound attempt carried the contract to 6785.00 at 14:25, but that rally stalled short of the earlier high. Afternoon trade turned defensive again, with the ES sliding through multiple minor lower highs before tagging 6764.75 at 16:05 in the cleanup session.
Across the day, the ES oscillated within a roughly 30-point range between 6759.25 and 6789.75. Volume totaled 1.25 million contracts, with 1.05 million traded during the regular session. The combined full-session settlement printed at 6772.50, down 7.00 points or -0.10% from the day’s open. The Globex session was down 5.25 points (-0.08%), and the cash session slipped 2.25 points (-0.03%), underscoring a modestly bearish tone despite repeated intraday rebounds.
Market tone remained generally two-sided, with traders fading extremes and liquidity favoring the mid-range. Early strength was met with overhead supply, while dips attracted measured buying. Despite the intraday volatility, the ES never established a clear directional bias.
The Market-on-Close imbalance leaned modestly negative, showing a net sell imbalance of $57.58 million at 15:55 with 700 total symbols — 46% to buy and 54% to sell. The S&P 500 component leaned -51.2% by value and -50.6% by symbol count, indicating a mild downside pressure into the close. Sector-wise, Energy (+85%) and Utilities (+80%) showed the strongest buy imbalances, while Consumer Cyclical (-71%), Financial Services (-69%), and Healthcare (-73%) carried the heaviest sell flows. These defensive-to-cyclical rotations left the late tape balanced but soft, keeping the ES pinned below its mid-session highs into settlement.
Overall, Tuesday’s action reflected consolidation following last week’s advance. While sellers controlled the afternoon, the lack of a decisive breakdown suggests continued range trade ahead of midweek catalysts.
Technical Edge
Fair Values for October 22, 2025:
-
SP: 36.38
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NQ: 156.2
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Dow: 189.37
Daily Market Recap 📊
For Tuesday, October 21, 2025
• NYSE Breadth: 47% Upside Volume
• Nasdaq Breadth: 57% Upside Volume
• Total Breadth: 56% Upside Volume
• NYSE Advance/Decline: 57% Advance
• Nasdaq Advance/Decline: 48% Advance
• Total Advance/Decline: 51% Advance
• NYSE New Highs/New Lows: 68 / 20
• Nasdaq New Highs/New Lows: 186 / 72
• NYSE TRIN: 1.53
• Nasdaq TRIN: 0.68
Weekly Market 📈
For the week ending Friday, October 17, 2025
• NYSE Breadth: 57% Upside Volume
• Nasdaq Breadth: 55% Upside Volume
• Total Breadth: 55% Upside Volume
• NYSE Advance/Decline: 64% Advance
• Nasdaq Advance/Decline: 59% Advance
• Total Advance/Decline: 61% Advance
• NYSE New Highs/New Lows: 230 / 136
• Nasdaq New Highs/New Lows: 564 / 296
• NYSE TRIN: 1.36
• Nasdaq TRIN: 1.15
ES Levels
The bull/bear line for the ES is at 6773.75. This is the key pivot level for determining intraday direction. A sustained move above this level favors the bulls, while failure to hold above it keeps the tone bearish.
Currently, ES is trading around 6781.50, slightly above the bull/bear line, suggesting an early attempt to firm up above key support. If the market can hold over 6773.75, the next upside objectives are 6789.75 and 6839.25. A move through 6839.25 could extend toward 6900.75.
On the downside, initial support is seen at 6759.25. A break below this level opens the door for a test of 6708.25, the lower range target. If weakness persists below 6708.25, a slide toward deeper support at 6646.75 becomes possible.
Intraday bias leans cautiously bullish while ES holds above 6773.75, but any sustained rejection below that line would quickly shift control back to the sellers.
NQ Levels
The bull/bear line for the NQ is at 25,291.00. This level marks the key pivot point for the session. Trading above it favors the bulls, while remaining below signals weakness and potential continuation of the recent downside pressure.
Currently, NQ is trading near 25,292.75, testing the bull/bear line. Sustained acceptance above 25,291.00 could lead to a move toward resistance at 25,326.75 and 25,368.00, with the upper range target sitting at 25,587.75. If buyers can hold strength above these levels, a test toward the broader resistance zone near 25,866.00 is possible.
On the downside, initial support lies at 25,203.25. A break below this level opens the door for a move toward the lower range target at 24,994.50. Continued selling could extend the decline to deeper support around 24,715.25.
Overall, the tone remains neutral-to-bullish as long as price stays above 25,291.00. A failure to hold this pivot would shift momentum back to the sellers with targets back into the mid-24,000s.
Calendars
Economic
Today
Important Upcoming / Recent
Earnings
Upcoming
Recent
Trading Room Summaries
Polaris Trading Group Summary – Tuesday, October 21, 2025
Tuesday was a textbook Cycle Day 2 with a consolidation/balancing session following a strong prior trend day. Price action respected the Line in the Sand (LIS) at ES 6765, providing both long and short opportunities, with morning trades offering the best setups.
Key Trade Highlights:
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Pre-Market Plan (Manny):
Manny detailed four structured trade levels with triggers, targets, and stops. These were well respected during the session and became reference points throughout the day:-
Support Trigger: ES 6763
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Continuation Trigger: ES 6788
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Breakdown Trigger: ES 6738
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LB&F Setups: ES 6733 and 6693
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Opening Support Reaction:
Price dipped to the LIS at 6765 pre-market and found buyers, setting the tone early for support holding. -
Crude Oil Trade (CL):
David called a short OPR trade with all targets hit successfully by 9:47 AM — a clean, profitable setup.
PeterN shared his own successful trades on NQ (750 tick chart) and CL (2-min chart), showing varied but effective strategy implementations. -
ES Long Setup – A4 & A10:
After sellers showed early aggression, price re-tested and reclaimed the LIS, prompting David to shift bias to longs.
The A4 long setup scaled into profit, and A10 joined in with successful follow-through.
Both trades hit their targets, with stop trails locking in gains.
Manny noted this price behavior aligned with the Buy The Dip (BTFD) expectation for a Cycle Day 2.
Lessons & Insights:
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Importance of the LIS:
The 6765 level was pivotal, acting as both a morning support and an anchor for afternoon probes. -
Cycle Day Awareness:
David emphasized the value of understanding market cycle structure. The Cycle Day 2 behavior led to chop and balance — crucial to avoid overtrading midday. -
Trade Management Discipline:
Manny’s early trade exited for a -5.25 loss triggered S.L.P. (Stop Loss Protocol). This showed great discipline in risk control and following pre-defined rules. -
Flat EMA Consideration:
Roy highlighted hesitancy due to flat MAs, and David reinforced that EMAs lag and suggested using sell stops to trigger entries, not second-guess setups.
Afternoon Session:
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Price remained contained in a tight 6776–6784 range over the final 2 hours.
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David initiated a short A10 position, scaled, and locked in gains with risk-free balance.
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The session ended with a small MOC sell and reaffirmation that AM session held the best opportunities.
Final Thoughts:
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Best setups occurred in the morning, particularly around the reclaim of LIS and clean execution of the A4 and A10 long plays.
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The room showed solid structure, strong adherence to pre-market plans, and disciplined trade management.
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Textbook Cycle Day 2 behavior rewarded patience and selective engagement — a solid session for learning and executing high-quality trades.
Discovery Trading Group Room Preview – Wednesday, October 22, 2025
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Gov’t Shutdown: Enters week 4 with limited economic data; focus shifts to Friday’s CPI report.
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Metals Pullback:
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Gold drops >3% to ~$4,000/oz after 9 straight weeks of gains (still +55% YTD).
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Silver falls 6.3% — largest single-day decline in over a decade.
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Earnings Highlights:
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GM & Coca-Cola: Strong earnings drive Dow to record intraday high above 47,000.
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CapitalOne (COF): +4% AH on 80% net income surge; $16B stock buyback planned; positive integration with Discover.
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Netflix (NFLX): -6% AH after earnings miss and 2025 guidance raise; record content engagement noted.
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Canelo vs Crawford: 41M global viewers – most-watched boxing match this century.
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KPop Demon Hunters: 325M views – Netflix’s most-watched film ever.
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JPMorgan sees ad revenue rising from $1.4B (2024) to $4.2B (2026).
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Tesla (TSLA) Reports Tonight:
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Focus: Robotaxi updates, EV tax credit impact.
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Q3 deliveries: 497,099 units (vs. 439,800 est., 462,890 YoY).
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Premarket Earnings: AT&T, Barclays, Boston Scientific, GE Vernova, Hilton, Thermo Fisher, etc.
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After the Bell: Tesla, IBM, Lam Research, SAP, Southwest Airlines, O’Reilly Auto, and more.
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Volatility Watch:
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ES 5-day ADR down to 100 pts.
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Bullish grind continues, but downside volatility risk rising.
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Key Technical Levels (ES):
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Resistance: 6877/82, 6966/71, 7173/78
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Support: 6611/16
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50-MA (~6642.75) holding as loose support.
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Today’s Calendar:
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10:30am ET – Crude Oil Inventories
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After the bell – Fed Gov. Barr speaks on financial inclusion (pre-recorded)
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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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