by Danny Riley

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Our View

I have the Friday morning blahs. It’s been a very long week of ups, downs, and all around. Did Trump secure a trade deal with Xi? I guess he did, but having to review the deal every year casts a shadow of doubt about the Chinese position. While the meeting was going on, China was urging its trading partners to start using the blockchain-based payment system. I hate to say this, but I think the US should stop trying to be the global military and finance sheriff and start to focus on our own domestic and debt problems. The problem is, without a guided plan, things will only get worse, and instead of talking about a $40 trillion deficit, we will be talking about a $50 trillion deficit.

The time to stop kicking the can down the road is NOW!

During the Trump/Xi talks, the ES rallied up to 6953.75 and traded down to 6887.00 on Globex and opened Thursday’s regular session at 6893.00, printed 6893.25 and dropped 25.5 points down to 6867.75 in less than 4 minutes, rallied 46 points up to 6913.75 at 10:00, and then… I have to do a hard stop on the recap today. If I listed out every 10, 20, 30, 50 or 50-point pop and drop, it would take all day to read. I get it — it was a sell-the-news kind of day, and the ES reacted in kind all the way into the 3:50 imbalance and into the cash close.

The ES traded 6865 at 3:42, traded 6860.25 as the 3:50 cash imbalance showed $1 billion to buy, traded 6853.75 on the 4:00 cash close, and that’s when all hell broke out. All the action was after the close as ES has a violent reversal moving to the upside, moving from a low of 6851 to 6877.75. A 26-point move in less than 2 minutes. But wait. 4:30 put in a one-minute downside candle from 6878 down to 6860, an 18-point spike down. The bulls were not having it and pushed higher from there into the 5 pm close of 6894. Overall, during the brief one-hour Globex session, ES trimmed 40.25 points off the day’s loss. The regular session closed – 74.25 points from the previous cash close, down 1.07%.

Earnings were fairly positive with beats from Apple (AAPL, +6% AH) and Amazon (AMZN, +13% AH), and then rallied all the way back up to 6900. The ES settled at 6855.50, down 67.25 points or -0.97%.

The NQ settled at 25,882.75, down 379.75 points or -1.45% on the day.

In the end, it was a very messy trade with the NQ leading the ES lower most of the day. In terms of the ES and NQ’s overall tone, they acted weak, but it was by no means a kill job. In terms of the ES’s overall trade, volume was higher at 1.76 million contracts traded.

Our View

Welcome to the month-end hijinx, where anything goes. I know the ES and NQ have had a lot bigger moves in the past, but there has been some extreme chop this week.

Japan’s Nikkei 225 hit a record high last night after Washington and Beijing reached a trade truce over rare earths, and South Korean chip and AI-related shares jumped after Nvidia announced expanded partnerships with Seoul and Hyundai. Seems like a lot of trading deals are getting done. And Bitcoin is up over 3,650 points at 111,185.

Our Lean

Today is the Week 4 Friday options expiration and the last trading day of October. We saw a lot of selling yesterday, and while I can’t say we won’t see more, I think we could see another push up — but I don’t think we’ll see new highs today. Handel Stats expanded on my study I put in the OP yesterday, and the first trading day of November has been up 13 in a row, and the week in general is higher.

Our lean: I think you can buy the dips. 6850 is key on the downside, and there should be decent resistance at the 6930 to 6950 area.

We’ve never offered a deal like this before, and it includes all our tools, including the Imbalance Meter.

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

Founder’s Note:

Futures are up +70bps with positive ER reactions to AMZN +12% and AAPL +1.2%. CORE PCE 8:30 AM ET.

TLDR: Yesterday’s meager 1% decline started to ease the “risk alert” positioning we flagged on 10/29, with call skews shifting to “rich” vs “screaming overbought”. Thats good news for bulls, as we think there is less spasm risk (a la 10/10). On the flip side, we are not seeing any obvious long opportunities, either. Bottom line: We hold the VIX call spread hedges we bought earlier this week, but with a close back >6.900 we’re back into a risk-on stance.

We see negative SPX gamma (red areas on TRACE) all around the 6,900 level, suggesting price action should remain fluid. Clearly the buy-the-dip impulse was strong after yesterday’s ~1.4% decline (from the intraday highs), but the overnight buying did not produce stability below. Stability now appears more in the 6,700’s. The instability works both ways, with negative gamma clear up into 7,000.

One of the key triggers here for more upside would be a vol crush, and its been more of a “notch lower”, as you can see in 1-month skew today (teal) vs Tuesday night (gray, pre-FOMC & US/China). That move is honestly pretty bland.

However, this 1-2 days of digestion is serving to burn off the very overbought call skew – we’re now at just “rich” skews on the index side (QQQ/SPY), and it seems like earnings is serving to greatly reduce the skews in Mag 7 names. If you watched our earnings webinar we covered how to identify these rich skews and structure trades around them – with the key insight that overbought call skews mean upside expectations are MASSIVE, and anything less than MASSIVE results in skews flattening.

Below is the change in GOOGL fixed strike vol from Wed PM (pre-ER) vs last nights close. You can see is a massive see of red, particularly for strikes >$280 (x axis, gray box, where stock closed last night). This infomrs us that those upside calls got crushed after earnings, losing as much as 12 vol points. Equity Hub showed us dealers were short these GOOGL calls, likely delta neutral, suggesting that the IV crush was profitable for them and likely allowing them to sell some stock.

Remember this overbought skew dynamic was true for nearly every major US stock (i.e. AI/semi related), and we see MSFT, META, TSLA etc all moving towards more reasonable skews.

The punchline here is that we had a “risk alert” on 10/29, and we got just a ~1% selloff. Now, suddenly, vols are much more reasonable which suggests the spasm-like positions are, well, less scary. This can all boil down to what we see in COR1M, which is no longer in the “high risk” zone <8, and more of a mild 11. On a technical note, with AAPL & AMZN earnings behind us, COR1M likely pops even a bit higher for today single stock IV contracts vs index.

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

Market-On-Close Recap – October 31, 2025

Friday’s MOC data showed a pronounced divergence between exchanges, with strong buying in Nasdaq offset by significant selling across the NYSE. The total market imbalance settled at a net $1.057B to buy, recovering from earlier swings that saw the aggregate briefly dip negative into the close. The pattern showed early strength, fading into 15:56 before modest recovery into the bell — a rotational but tech-driven session.

The S&P 500 finished with a net $1.12B buy, while the NASDAQ showed the day’s largest imbalance at $1.87B to buy, leaning +72.9%, a notable wholesale market buy signal. Conversely, the NYSE posted a heavy $879M sell, leaning -61.2%, suggesting broad profit-taking and rotation out of legacy and value sectors.

Sector flows painted a clear picture of leadership:
• Technology dominated with $1.64B net to buy, led by mega-caps MSFT, NVDA, AAPL, and AVGO.
• Consumer Cyclicals followed with $370M buy, highlighting AMZN and TSLA.
• Financials (-$303M) and Energy (-$264M) saw heavy outflows, as traders lightened positions in XOM, CVX, and WFC.
• Utilities and Materials also showed deep sells, both leaning more than -70%, indicative of institutional rotation away from defensive and commodity-linked names.

Among single names, GOOG, NVDA, and MSFT led the upside buy programs, while CVX, XOM, and BRK.B were notable sells. The pattern confirms a continued flow back into growth and AI-linked sectors as month-end positioning favored Nasdaq heavyweights.

Overall, the MOC opened with strong buy interest that spiked to over $4.5B, reversed mid-cycle as sell imbalances surged above $4B, then stabilized into the close — a hallmark of sector rotation rather than panic. With tech absorbing liquidity and NYSE sectors being sold, the session closed with a distinctly bullish growth bias, pointing toward sustained demand in high-beta names heading into November.

On the MIM:

How to read the MIM

ES Levels

The bull/bear line for the ES is at 6874.25. This level marks the key pivot between bullish and bearish sentiment for today’s session. A sustained move above it would suggest buyers regaining control, while trading below favors continued weakness.

Currently, ES is trading around 6905.00 in the Globex session, showing a modest recovery from Thursday’s late-day weakness. The short-term tone remains cautious, but holding above 6900 could invite further upside attempts.

If price holds above the bull/bear line and reclaims the upper range target at 6919.50, look for an advance toward 6962.00, which also coincides with resistance from Wednesday’s high area. A push through these zones could open the door to a test of 6980.

On the downside, a break back below 6874.25 would shift control back to sellers, with the first downside target at 6855.50, followed by 6829.00 as the lower range target. A failure there risks a deeper slide toward 6786.50.

Overall, the bias leans neutral-to-bullish while ES trades above 6874.25, but sustained strength above 6919.50 is required to confirm momentum toward 6960 and beyond. Below 6874.25, expect renewed selling pressure and a retest of support levels from earlier in the week.

NQ Levels

The bull/bear line for the NQ is at 25,980.00. This level is key for determining directional bias today. Trading above this mark would indicate potential strength and favor buying dips, while staying below suggests continued bearish pressure.

Currently, NQ is trading around 26,207.50 in the Globex session, holding above the bull/bear line. The next resistance levels to watch are the upper range target at 26,231.25 and 26,399.00. A breakout and hold above 26,468.00 could extend the rally toward 26,511.75.

On the downside, initial support is seen at 26,154.50. If price breaks below that, the next support levels are 25,882.75 and 25,728.75, which is also the lower range target for today. Further weakness could expose 25,492.25.

Overall, bias leans bullish while above 25,980.00. Sustained trade below that level would shift momentum back in favor of the sellers, targeting 25,728.75 and below.

Technical Edge

Fair Values for October 31, 2025

SP: 30.27
NQ: 134.34
Dow: 146.3

Daily Breadth Data 📊

For Thursday, October 30, 2025

• NYSE Breadth: 33% Upside Volume
• Nasdaq Breadth: 44% Upside Volume
• Total Breadth: 43% Upside Volume
• NYSE Advance/Decline: 35% Advance
• Nasdaq Advance/Decline: 34% Advance
• Total Advance/Decline: 34% Advance
• NYSE New Highs/New Lows: 93 / 131
• Nasdaq New Highs/New Lows: 126 / 214
• NYSE TRIN: 1.15
• Nasdaq TRIN: 0.63

Weekly Breadth Data 📈

Week Ending Friday, October 24, 2025

• NYSE Breadth: 57% Upside Volume
• Nasdaq Breadth: 57% Upside Volume
• Total Breadth: 57% Upside Volume
• NYSE Advance/Decline: 74% Advance
• Nasdaq Advance/Decline: 67% Advance
• Total Advance/Decline: 70% Advance
• NYSE New Highs/New Lows: 229 / 66
• Nasdaq New Highs/New Lows: 595 / 257
• NYSE TRIN: 2.12
• Nasdaq TRIN: 1.52

Calendars

Economic Calendar Today

This Week’s High Importance

Earnings:

Full Calendars

Trading Room News:

Polaris Trading Group Summary – Thursday, October 30, 2025

Thursday was a distribution day marked by early strength and sharp reversals, ending in a downside flush. The session presented multiple trade opportunities, both long and short, centered around key levels and order flow confirmation. Execution and trailing management were highlighted, and while the day wasn’t easy, it rewarded well-prepared traders who followed the playbook.

Key Trades & Execution Highlights:

Pre-Market Trade Plan (Manny):

Focus on support buy zones at:
- 6905.50–6910.50 ES
- 6880.50 ES
- 6855.50 ES
Notable setups:
- Continuation Long above 6910.50
- Breakdown Short under 6900.50
- Look Below & Fail (LB&F) at 6895, 6865, 6776

Morning Execution – Longs Work Early:

Manny led a strong early trade, calling a setup from the LB&F zone, posting a quick +10, +15, then +20, and eventually a +26 runner.
- Great teamwork and communication from the room.
- David praised Manny for prepping the group well.
Shift to Long Bias post-early move:
- David: “Shift back to longs on dips” – particularly around 6915 ES level (declared “line in the sand”).
- A4 and A10 long setups scaled and trailed for profit.
- Some noted challenges with trailing runners—Manny mentioned giving back more than he wanted.

Afternoon Fade – Distribution Confirmed:

6910.50 continuation long discussed but never fully confirmed – price began to fail key levels.
Post-10:30 AM: Failure to hold above 6915 → selling resumed.
Afternoon session:
- Key level 6865 broke, triggering downside continuation.
- 6855.50 Money Box level tagged to the tick – textbook support test.
- Slatitude39 executed a long at 6862.25 per Manny’s LB&F plan, reinforcing the value of staying aligned with setups.

End-of-Day Breakdown:

Massive shift:
- MOC Buy imbalance of $1B flipped to a $2B Sell
- Market closed at lows
- David confirmed Cycle Day 1 projections already met – expecting deeper downside tomorrow.
- Next Target: 6840 gap fill.

Lessons & Takeaways:

Order Flow + Level Alignment = Edge
Manny’s early prep around key support zones created actionable structure for the day.
Patience Pays
Manny’s late-day reminder: “Don’t beat yourself up… easy is not one of the things this is.”
Trailing Runners is an Art
Several comments today about the difficulty in trailing effectively—worth reviewing.
Stay Adaptive
Morning longs transitioned to afternoon shorts as key levels failed. The room adapted well to shifting flows.

Looking Ahead:

Cycle Day 1 today – bias is for continued weakness.
Eyes on 6840 as next downside target.
PCE report at 8:30 AM ET – expect increased volatility.

Summary:
Strong prep led to strong execution early. The day required adaptability as the market rotated lower through key support levels, confirming the distribution theme. Despite some challenges, several members found success by sticking to the plan. Solid day for learning and for those who stayed focused — great work by the room.

DTG Room Preview – Friday, October 31, 2025

Market Rebound:
- U.S. indexes bounced overnight after strong earnings from Amazon (AMZN) and Apple (AAPL), offsetting META/MSFT-led selloff.
- Volatility remains elevated; ES 5-day ADR ticked up to 74.25.
Amazon (AMZN):
- Beat on top/bottom lines; AWS growth beat expectations.
- AMZN up 13% AH.
- Trainium2 chip adoption +150% YoY; multibillion-dollar AI business.
- Project Rainier: 500K Trainium2 chip AI cluster launched.
- Partnered with Anthropic for AI exposure.
Apple (AAPL):
- Beat on earnings; China sales soft.
- CEO Tim Cook said iPhone 17 demand is straining supply.
- Expects record December quarter revenue.
Nvidia (NVDA):
- Market cap tops $5T.
- Supplying 260K chips to South Korea for sovereign AI push.
- Deals also in UAE, Saudi Arabia, Europe, UK.
- APEC announcements with Samsung, SK, Hyundai, NAVER.
Macro Headlines:
- China’s PMI dropped to 49—6-month low; lowest new orders since 2023.
- Fresh calls for stimulus.
Today’s Earnings Watchlist:
- Premarket: ABBV, AON, CNI, CG, CVE, CHTR, CVX, CHD, CL, D, XOM, LIN, LYB, MGA, NVT, RBC, SHG, TROW, GWW.
Economic Calendar:
- Chicago PMI (9:45am ET).
- Fed speakers: Logan (9:30am), Bostic & Hammack (12:00pm).
- Gov’t shutdown enters Day 30—calendar remains light.
Tech Levels (ES Futures):
- Resistance: 7005/10, 7050/55, 7340/45
- Support: 6823/28, 6705/10
Whale Flow:
- Bearish bias into U.S. open on elevated overnight large trader volume.

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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!!