on August 8, 2025

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Our View

Globex Session:

High: 6426.75
Low: 6364.25

Day Session:

Open: 6407.25
High: 6414.50
Low: 6334.50
3:50 Imbalance: $1.2 B to buy
4:00 Cash Close: 6367.50
5:00 Futures Close: 6373.75
Volume: 1.396 M

The Information Age

I really didn’t pay much attention to the economic numbers when I ran my S&P desk on the floor—I was too busy. But I did pay attention to Fed meetings, jobs reports, and the quad witching expirations. What I really focused on were all the “yellow jackets” and the information they provided.

As I recall, the locals in the S&P pit fought to get a big screen put up above the pulpit so they had stocks and news flashing. The news service was crude by today’s standards, and if you had a Bloomberg, you could beat the pit. When I noticed that happening, I put a small TV on the end of the desk and turned on CNBC or Bloomberg. Sure, you could read the tape, but if your back was turned to the big quote screens, you would miss the headlines. Having the TV on the desk solved that problem.

I said many years ago that we (the trading floor) lived in an ever-changing world, where nothing stayed the same. The floors were changing, but the level of stress wasn’t. Every day, I would walk up to the desk at 8:15 CT, looking at the pit and all its ragtag clerks (who I loved), all hungover and yelling—and the markets hadn’t even opened yet. I compared it to being modern-day gladiators preparing for battle. I AM NOT KIDDING.

The phones would start ringing and the brokers would start jumping into the pit to get their spots. The pushing and shoving began, and the clerks would start yelling at the desk about the opening indication. There were direct lines and outside lines; I picked up both. But my main job was the bank, hedge funds, and prop firm direct lines. The one I favored most was the UBS program trading line.

I knew from working with all the customers that as soon as I did a few buy or sell programs, the lines would light up. The first thing they’d say was, “Who’s buying or selling?”

Fair Value

If I was doing an index arb buy program, I would offer the SPU at 1.00 premium over the S&P cash. If fair value was 1.50, I would be offering the SPU 1.00 over fair value—or at a premium to the cash market. When I was doing sell programs, I would be bidding for the futures 1.00 under fair value, or a dollar under.

If the levels started to line up, I would pick up UBS and tell the trader, “we’re close,” and then put in lower SPU bids. As the futures started falling, the big accounts would be ringing the desk. And as I’ve said in the past, I would work both sides of the trade.

I had the UBS bids for sell programs in one ear and a $20 billion hedge fund telling me to sell 500 SPU. I would deliberately hit my own sell program bids, and the cash would fall apart. I’d pick up the direct line to the fund and tell him he sold 500 while UBS was still on the line, and then he would say, “Sell another 500.” I’d repeat the order so the trader at UBS would immediately give me lower bids to place.

I would wind it up, look at the pit, and yell, “Sell 500!” and knock out all my bids. I’d pick up the direct line again and tell the fund trader he sold a total of 1,000 lots. He might say, “Thank you” or “Sell another 500.”

This would cause havoc in the spoo pit—everyone selling as the cash tumbles. After the third sell program in a row, other desks in the S&P would start placing bids to do sell programs. But by the time we got into the fourth sell program, there would be 1,000 SPU bid for around the pit. A seller would whack out the bids, the cash would fall again, and 5 ticks lower, there would be 1,000 to 1,200 bid for.

The selling would dry up, and the futures would start going back up. Why? Because the pit and customers got short into the sell programs. And after the last batch of bids didn’t get filled, the S&P cash would start short covering and the shorts got screwed.

I know I’ve written about this before, but I think one of the reasons the PitBull wanted to meet me was for the exact flow I described above—having both sides of the trade. He hated program trading, and he knew that when the levels lined up, he’d call the desk and ask me what was going on. I’d say, “I’m doing sell programs,” and he’d either slam the phone down or tell me how someday it would ruin trading the S&P futures.

The Ladder

Before the 2008 credit crisis, the ladder in the ES was “thick.” At various times throughout the day, there could be as many as 25,000 to 30,000 ES bids or offers in a 6 to 8 tick range—especially going into the last 45 minutes of the day or into the 4:00 cash close.

It’s very different today. Sometimes you’ll only see 100 to 300 lot bids or offers, but I think some of the drops and rips we see are big customers trying to execute large orders when it’s extremely thin.

In the end, yesterday was a big gap up, a drop after the open, and then:

IMPRO : Dboy : (9:34:14 AM) double pump back up and the higher low that set up the selloff down to 6334.50—then back up to the 6373 area late, and up to 6387.50 on Globex.

In terms of the ES’s overall tone, once the NQ started breaking down, the ES went for the ride. In terms of the ES’s overall trade, volume was steady at 1.396 million contracts traded.

Our Lean

PitBull said many of the stocks he follows are not making new highs, and the rest are being held up by the Nasdaq and the top 10 stocks, which support the broader market S&P. He’s excellent at reading the charts, but it looks to me like the ES is going back above 6400—and if it holds, back to the 6420 area.

On the downside, 6350 and yesterday’s low at 6334 are key, along with the 6320 level.

Our lean: Is again for higher prices. If the ES were to gap lower into the above-mentioned support levels, I would look to be a buyer of the open or on early pullbacks. If the ES gaps higher, I’m still long 1 ES from the 6350.50 level and offering 1 ES at 6410. If it keeps going up, I’d be looking for some type of pullback into the 11:30–11:45 time frame.

Today is also the Week Two Friday July expiration. The notional value is around $2.4 trillion, so this will show up somewhere. My plan is to trade the first hour and a half and the last hour. The mid-day trade has been a brain drain.

Guest Posts:

SpotGamma Founders Note:

Get instant access to our partners’ real-time market data and insights not available anywhere else. Here is last night’s Founder’s note getting you ready for today’s market and explaining the constraints in yesterday’s market. – MrTopStep

Futures are +30 bps with no major data on tap.

6,400 remains the prime overhead target.

First support is back at 6,350 today, with light positive gamma strikes from 6,370 down to 6,300. 6,350 was initial support yesterday due to a big 0DTE position, but that position was pulled – paving a way for the test of the 99th %ile 6,310 strike (see last nights note). While yesterday had a big range, it was so much in control of 0DTE options as we again saw massive HIRO deltas shove the SPX to the 99th %’ile 0DTE strike…then once that strike is hit those deltas shut off.

Start of day vol yesterday implied a low volatility session, but the intraday range was 1.25%. However, on a close to close basis, the SPX was unchanged. This means that most volatility metrics reflect zero volatility, which allows forward IV to contract. On this point, we see Monday is at a 10% IV, and while that is the product of the weekend effect, the 10% IV mark still shows us that expectations for vol today into tomorrow is essentially in the gutter. Finishing this point: todays 0DTE straddle is $25/39bps/16% IV. This lends to the idea that vanna remains a tailwind for equities into Tuesdays CPI print. Traders don’t really care about Tuesdays CPI print – its just that there is no data today or Monday for traders to 0DTE hedge.

Get instant access to our partners real-time market data and insights not available anywhere else. Here is last night Founder’s note getting you ready for today’s market and explaining the constraints in yesterday’s market. – MrTopStep

MiM and Daily Recap

Overnight Globex trade opened at 6371.00 and began with a modest drop to 6364.25 by 18:00 before reversing sharply to 6387.50 at 18:30, a 23.25-point recovery (+0.37%). Momentum carried higher to 6391.50 at 21:40, adding another 13.75 points (+0.22%) before a pullback to 6384.75 at 22:45 (-0.11%). Sellers pressed again after midnight, with a dip to 6380.25 at 01:00 (-0.15%), followed by a rebound to 6389.75 at 02:30 (+0.15%) and a minor retracement to 6382.75 at 02:55 (-0.11%).

From there, buyers took control, igniting a strong rally to 6426.75 at 06:15, a 44.00-point gain (+0.69%) from the prior pivot. This level marked the Globex high. A mild fade to 6413.50 at 08:30 (-0.13%) led into the regular session open at 6407.25. Globex closed at 6407.25, up 36.25 points (+0.57%) from its open and 35.50 points (+0.56%) from the prior cash close.

The regular session started with a quick rally to 6414.50 at 09:40 (+0.14%) before sellers seized control, driving prices down in a sustained decline to 6354.75 at 12:00 (-0.93%). An intraday bounce reached 6369.50 at 12:25 (+0.23%) before another wave of selling took ES to 6340.25 at 13:30 (-0.46%). A brief rebound to 6354.50 at 13:55 (+0.22%) failed to hold, sending prices to the regular session low of 6334.50 at 14:20 (-0.31%). Buyers managed a late-day lift, taking ES to 6373.75 into the cleanup session.

Regular trading closed at 6367.50, down 39.75 points (-0.62%) from the open and off 4.25 points (-0.07%) from the prior day’s cash close. The cleanup session was quiet, ending at 6373.75, a 6.25-point gain (+0.10%) from its open.

Market tone was mixed, with overnight trade clearly bullish while the day session shifted decisively bearish until late in the afternoon. Globex strength failed to translate into sustained cash session gains, as sellers dominated midday flows. The afternoon recovery was modest and lacked strong momentum.

The Market-on-Close imbalance showed $1.522B total, with 64.6% on the buy side, but the symbol percentage was only 53.6%, below the strong imbalance threshold. The largest buy imbalance came at 15:53 with $1.522B, but this was not enough to reverse the broader downtrend into the close. Price action into the bell reflected more of a stabilization than a breakout, leaving ES slightly above the afternoon lows but still closing the day flat relative to the prior cash settlement.

Overall, the session reflected a market struggling to hold early strength, with overnight buyers winning the first battle but cash session sellers prevailing for most of the day. Traders will watch to see if the late lift carries into the next session or if selling pressure resumes.

How to read the MIM

The bull/bear line for the ES is at 6372.25. This is the pivotal level to watch for determining today’s market sentiment. A sustained move above this level could encourage bullish momentum, while trading below keeps the bias to the downside.

Currently, ES is trading around 6384.75, showing slight strength above the bull/bear line. If this holds, the first upside target is 6430.00, which is today’s upper range target. Beyond that, resistance sits near 6475.75, the upper Bollinger band marker. Clearing this area would likely signal stronger buying pressure.

On the downside, initial support comes at 6334.50, followed by the lower range support at 6314.50. A break below these levels could see price move toward the next significant support at 6260.25.

Overall, the short-term bias is cautiously bullish while ES trades above 6372.25, but any failure to hold above this level could quickly shift momentum back toward sellers.

The bull/bear line for the NQ is at 23,497.75. This is the critical pivot point for today. If price sustains above this level, bullish momentum is favored, with the potential for a push towards the upper range target at 23,768.50. A break and hold above that could extend gains toward 24,023.25.

Currently, NQ is trading at 23,564.00, sitting above the bull/bear line. This early positioning suggests buyers are in control, but follow-through will be needed to maintain upward momentum. If bulls cannot hold above 23,497.75, sellers could regain control.

On the downside, the lower range target sits at 23,227. A break below this could bring 22,972.25 into play as the next significant support. Additional support is noted at 23,418.50 and 23,329.

Overall, the tone is cautiously bullish above 23,497.75, but a loss of this level could quickly shift sentiment back to bearish. Traders should watch for strong reactions around the bull/bear line to guide intraday positioning.

Technical Edge

Fair Values for August 8, 2025

SP: 22.9
NQ: 100.99
Dow: 95.47

Daily Breadth Data 📊

For Thursday, August 7, 2025

• NYSE Breadth: 50% Upside Volume
• Nasdaq Breadth: 56% Upside Volume
• Total Breadth: 53% Upside Volume
• NYSE Advance/Decline: 48% Advance
• Nasdaq Advance/Decline: 43% Advance
• Total Advance/Decline: 46% Advance
• NYSE New Highs/New Lows: 110 / 48
• Nasdaq New Highs/New Lows: 162 / 137
• NYSE TRIN: 0.88
• Nasdaq TRIN: 0.58

Weekly Breadth Data 📈

Week Ending Friday, August 1, 2025

• NYSE Breadth: 32% Upside Volume
• Nasdaq Breadth: 37% Upside Volume
• Total Breadth: 36% Upside Volume
• NYSE Advance/Decline: 31% Advance
• Nasdaq Advance/Decline: 22% Advance
• Total Advance/Decline: 24% Advance
• NYSE New Highs/New Lows: 217 / 133
• Nasdaq New Highs/New Lows: 438 / 322
• NYSE TRIN: 0.95
• Nasdaq TRIN: 0.46

Calendars

Economic Calendar Today

This Week’s High Importance

Earnings:

Full Calendars

Trading Room News:

Polaris Trading Group Summary – Thursday, August 7, 2025

Thursday featured early fulfillment of cycle targets, a “wild-card” classification, and a strong closing rally driven by a large MOC imbalance. The session rewarded disciplined scenario-based trading and adaptability.

Pre-Market & Setup

A weaker-than-expected jobs report increased the probability of a September rate cut to 90%.
Bank of England cut interest rates to 4%, contributing to a dovish global tone.
Overnight bullish momentum hit major targets: NQ reached 23632 and ES approached 6430.50.
Cycle Day 3 was declared a “Wild-Card” due to target fulfillment, implying less structured trade behavior.

Morning Session

Initial ES sandbox range was defined between 6400–6415.
Early success came with a Crude Oil (CL) Open Range short hitting its first target.
Emphasis was placed on discipline and tactical awareness, particularly in a Wild-Card environment.
David shared IF-THEN-ELSE examples to illustrate adaptive trading logic.
Range trading and risk management were discussed, including position sizing and using Bollinger Bands.

Midday Action

Open Range was broken, prompting a shift to “Sell Lean” strategy.
Price tested the key LIS zone at 6370 throughout the midday session.
David outlined a Bear Scenario: sustained trade below 6370 would target 6360–6355, which played out as projected.
NQ was relatively stronger throughout, maintaining bids above midpoints.

Afternoon & Close

Cycle Day 1 Average Decline projection at 6354.43 was fulfilled.
Bulls reclaimed the 6355 level and held firm heading into the close.
A $1.5 billion MOC buy imbalance fueled a sharp rally, lifting price from 6355 to 6370.
Session closed strong for the bulls, capping off the day with a “closing ripper.”

Lessons & Observations

Recognizing early cycle target fulfillment allowed the room to shift into tactical mode.
Scenario planning helped navigate the mid-session softness with clarity.
Late-day buying reinforced the importance of staying engaged and monitoring imbalance data.
Psychological resilience and disciplined loss-taking were highlighted as essential to long-term success.

DTG Room Preview – Friday, August 8, 2025

Crypto Surge: Cryptos rallied after President Trump signed an executive order pushing the SEC to enable retirement accounts to include crypto and alternative assets. Bitcoin hit $117K (+1%), ETH +5%, XRP +11%. BlackRock’s Larry Fink endorsed private assets in his annual letter.
Fed & Policy Moves: Stock futures edged higher overnight as Trump nominated Stephen Miran to the Fed board, signaling a potentially more dovish Fed. Bloomberg notes Fed Governor Christopher Waller as a front-runner for Fed Chair.
Gold & Oil: Gold jumped $125/oz to over $3500 on reports of upcoming U.S. tariffs on 1kg gold bar imports. Oil extended its longest downtrend since 2021, with WTI crude below $64 on escalating geopolitical tensions and tariff threats on China/India.
Tech Shift: Tesla is shutting down its Dojo AI team, shifting to external tech (Nvidia, AMD, Samsung) following a 20-person exodus to form DensityAI. Dojo head Peter Bannon is also leaving.
Flows & Volatility: BoA’s Hartnett reports $28B pulled from US stocks this week, while money markets gained $107B amid tariff concerns. Volatility remains steady; ES 5-day ADR is 94.75 pts.
Market Structure: ES finished flat Thursday, holding mid-channel. Key trendline resistance at 6556/61, 6592/97; support at 6291/94, 6027/32, 5766/71.
No Key Earnings or Data: Quiet calendar today with only a Fed speech (Musalem) scheduled. No notable 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!!