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Pink Slips and Paper Cuts — The Market Just Got Margin Called
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Our View
The ES sold off on Globex to kick off the night session and accelerated lower after the Challenger Gray report showed 153,074 October job cuts—a 183% surge from September’s 54,064 and 175% higher than October 2024. This marks the worst October since 2003 and the toughest layoff year since 2009, with year-to-date cuts at 1,099,500, or up +65% YoY.
Price action was brutal: the ES made an early low at 6804.00, briefly rallied to 6843.50, then sold off to 6817.50 on the headline. The ES opened the regular session at 6812.00, dipped to 6810.50, spiked to 6821.75, and then cratered down to 6772.00 by 10:05 AM ET.
The ES bounced to 6800.75 at 10:20 but was hit by a wave of tech sell programs that pushed it down to 6736.50 by 11:55. It then rallied up to 6758.00, sold off to a new low at 6733.50 at 12:24, made a higher low at 6738.00, and grinded up to 6784.25 at 3:35 before breaking down to 6751.00 at 3:47.
It traded 6750.75 as the 3:50 PM cash imbalance flashed $300M to buy, made a quick pop, and as the NQ started breaking down again, traded 6750.00 on the 4:00 cash close. After 4:00, the ES traded up to 6767.25 and settled at 6747.50, down 77.75 points or -1.14%. The NQ settled at 25,244.25, down 502 points or -1.95%, with tech hit hard by AI-related layoffs.
In the end, a mix of factors dragged on the market: job losses, Chicago Fed President Austan Goolsbee expressing hesitation about lowering interest rates further, the government shutdown, chaos in U.S. airlines, the record 38-day shutdown, BlackRock’s dump of $3 billion in crypto, Trump bashing Mamdani, the 10-year yield falling to 4.089%, down from 4.156% on Wednesday, and Putin paving the way for nuclear testing. And last but not least, the AI bubble.
In terms of the ES’s overall tone, it was weak—but not as weak as the NQ. In terms of the ES’s overall trade, volume was on the high side at 1.775 million contracts traded.
Record Fear & Greed
Clearly, there is a lot of fear and greed out there. As of yesterday’s close, the technology sector comprises roughly 36% of the S&P 500, with just the top five tech giants—all heavily invested in AI (Nvidia, Microsoft, Alphabet, Amazon, Meta)—making up nearly 30% of that index.
The Nasdaq technology and AI sectors’ weighting in the Nasdaq 100 Index is approximately 62.5%. A handful of AI-focused giants heavily influence this, with Nvidia holding a 13.79% weight, followed by Microsoft at 11.12%, and Amazon at 7.82%. The Nasdaq Composite is similarly dominated by these growth-oriented tech firms.
I am not here to argue about an AI bubble; all I am saying is, so far, this just looks like all the recent declines.
Our View
In a note to clients, analysts led by Andrew Tyler, the global head of JPMorgan’s market intelligence team, said the bank would be buying the dip in any sell-off through the end of the year—including this week. Tyler said, “We would be dip-buyers into year end,” and noted they believe the bull market in stocks is still intact, expecting the S&P 500 to “blast through” 7,000 over the “very near-term.” This implies the benchmark index jumping another 3% from its current levels.
Our Lean
I have been saying the ES is in a trading range—100 points on either side of 6800. Is the ES going to break through the support at 6700.00? It very well could. After trading up to 6772.00 on Globex early, the ES just broke down to the 6735 level.
Today is the November Week 1 Friday options expiration, with a notional value of $1.15 trillion. I have to admit, yesterday’s news overload weighed heavily on the downside, and every rally was sold.
Obviously, all the news about tech job losses has spooked the markets, and the constant headlines haven’t helped. Below are my AI levels. I want to get a look at the price action before trading today. I’m still looking for a low to get long from.
AI Levels:
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6716
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6705
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6700
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6690
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6675
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6645
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6642
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6602
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Guest Posts:
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:
Founder’s Note:
Futures are off 15 bps with no major news on the tape for today. NFP was scheduled for today but we understand that its canceled due to the shutdown.
With futures again lower here, we see the SPX decline at ~3% vs 10/29 highs, and quite frankly it feels a lot uglier than that. That 3% is the same decline that we saw into 10/10, but this has definitely been a lot less violet – so far. We hate being alarmists after a 3% drop, but suddenly there is a sneaky bid to vol, and we see nothing but negative gamma for ±50-100 handles. The difference today is that we suddenly see some non-0DTE put buying, and that has largely been absent the last several days. For this reason we are now quite cautious, as this feels like a place wherein things could get “crashy”.
It seems we’ll need some concrete news (i.e. “shutdown over”) or an OPEX to clear out what ails the S&P. OPEX is not for another 2 weeks…
Zooming in, you can see SPX gamma is negative (red) all around current levels, with yesterday’s implied support near 6,700 having faded to 6,600. There is no material positive gamma from non-0DTE contracts at any SPX level (both higher and lower).
The 0DTE crew seems to have layered in some 6,600 area short puts, giving dealers positive gamma into 6,600, but that faces off against large non-0DTE long puts from 6,650 – 6,700 (dealers short/negative gamma). The end result of this is that 6,700 is a very unstable price floor, and we don’t believe much in 6,600 as a floor past today given its primarily 0DTE.
Watching HIRO remains critical for live reads on flow. With negative/positive HIRO‘s downside/upside has the edge.
As mentioned at the top, while VIX is still holding 20, we are starting to notice a bid for tails here, and that is a departure vs recent sessions. Here is day-over-day 11/21 SPX skew, with that put wing widening out vs ATM.
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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
Thursday’s Market-on-Close (MOC) opened with a modest $80 million buy imbalance at 3:50 p.m. but quickly flipped to heavy selling pressure as institutional order flow accelerated. By 3:55, the MOC showed over $4.2 billion to sell versus $1.2 billion to buy, a sharp -82% lean, before moderating into the bell. The imbalance settled at -$893 million overall, with $1.27 billion to sell against $378 million to buy, reflecting persistent but narrowing sell programs into the close.
At the sector level, Technology led the market with a massive $429 million net buy, driven by broad inflows into semiconductors and mega-cap tech. Apple (AAPL) dominated the tape with $239 million in total paired volume, followed by NVDA ($47.7M) and AVGO ($76.5M). The group’s +68.7% lean signals a clear wholesale rotation into growth and AI-related names.
Financial Services followed with a $120 million net buy (+61.2%), paced by strong interest in MA and BRK.B. This was one of the few traditional sectors with sustained inflows. Consumer Cyclical also saw net buying of $70 million (+56.4%), anchored by McDonald’s (MCD) and TJX.
Conversely, several sectors were hit by broad-based outflows. Consumer Defensive (-$129.8M), Industrials (-$114.9M), and Healthcare (-$42.2M) all saw strong selling, each with leans near -65%, consistent with a rotation out of safety into growth. Utilities (-66.3%) stood out as one of the most one-sided sell sectors, pointing to fund managers reducing defensive exposures.
Among notable individual flows, META ($103.9M) and GOOGL ($97.7M) attracted solid buy programs, while AEP (-$56.4M) and GILD (-$45.5M) were net sold.
By venue, the NASDAQ dominated, closing with a $385 million net buy imbalance and a +61.2% lean—evidence of concentrated demand for tech and momentum names. The NYSE closed with a -$198 million net sell (-53.5%), while the S&P 500 ended near neutral at +$97.6 million (+51.2%), underscoring the rotational rather than directional nature of the close.
On the MIM:
ES Levels
The bull/bear line for the ES is at 6764.00. This level defines the current directional bias. Trading above it favors the bulls, while sustained trade below suggests continued bearish pressure.
Currently, ES is trading around 6736.00, below the bull/bear line, showing weakness in the pre-market session. If it remains below 6764.00, the path of least resistance remains to the downside with initial support at 6733.50 and then the lower range target near 6699.75. A break under this level opens the door to 6639.50 and possibly deeper into the 6620.00 zone.
On the upside, resistance comes in at 6764, the bull/bear line and then at 6828, which represents the upper range target for today.
Overall, below 6764.00, the market bias remains bearish. Bulls will need to regain and hold above this pivot to trigger any sustained recovery attempt.
NQ Levels
The bull/bear line for the NQ is at 25,350.50. Trading below this level keeps the tone bearish for the session. If price can reclaim and hold above it, sentiment may shift back to neutral or slightly bullish.
Currently, NQ is trading near 25,172.00 in the Globex session, showing weakness under the bull/bear pivot. Immediate support lies at 25,000.75, the lower range target for today. A sustained break below this level could trigger further downside toward 24,671.50.
On the upside, resistance is seen at 25,244.25 and 25,700.25, with the upper range target sitting near 26,029.50. If NQ can reclaim 25,350.50 and close above 25,700.25, momentum could extend toward 25,822.25 or even 26,000+.
The current structure remains bearish under 25,350.50, favoring short setups on bounces until that level is recovered. Bulls will need to see stabilization above 25,350.50 to regain control and challenge the mid-range resistance at 25,700.25.
Technical Edge
Fair Values for November 7, 2025
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SP: 25.92
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NQ: 112.76
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Dow: 107.36
Daily Breadth Data 📊
For Thursday, November 6, 2025
• NYSE Breadth: 39% Upside Volume
• Nasdaq Breadth: 38% Upside Volume
• Total Breadth: 38% Upside Volume
• NYSE Advance/Decline: 34% Advance
• Nasdaq Advance/Decline: 28% Advance
• Total Advance/Decline: 30% Advance
• NYSE New Highs/New Lows: 93 / 138
• Nasdaq New Highs/New Lows: 109 / 303
• NYSE TRIN: 0.78
• Nasdaq TRIN: 0.62
Weekly Breadth Data 📈
Week Ending Friday, October 31, 2025
• NYSE Breadth: 46% Upside Volume
• Nasdaq Breadth: 55% Upside Volume
• Total Breadth: 52% Upside Volume
• NYSE Advance/Decline: 32% Advance
• Nasdaq Advance/Decline: 35% Advance
• Total Advance/Decline: 34% Advance
• NYSE New Highs/New Lows: 293 / 181
• Nasdaq New Highs/New Lows: 700 / 373
• NYSE TRIN: 0.53
• Nasdaq TRIN: 0.42
Calendars
Economic Calendar Today
This Week’s High Importance
Earnings:
Trading Room News:
Polaris Trading Group Summary – Thursday, November 6, 2025
Thursday’s session was a bear-dominated, high-volatility day, with strong downward momentum throughout the session. While bulls attempted to step in a few times, sellers maintained control, especially after midday. The team showed discipline in navigating the chop and managing risk carefully, with a few well-executed trades and great lessons in emotional control, trade timing, and system reliance.
Highlighted Trades:
Manny’s Continuation Long (ES 6825–6829)
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Trigger: Acceptance above the zone with positive cumulative delta.
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Outcome: Trade triggered around 8:02 AM.
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Result: Manny booked +5 pts, even with a “terrible reactive add” and poor average fill. He managed the trade actively, trailed profits, and held 1 contract at breakeven.
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Lesson: Poor fills can still be managed well if trade structure and discipline are in place. Emotional reactions can compromise trade quality, and flexibility is key.
Manny’s LB&F Trade (ES 6769–6773)
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Trigger: Capitulation wick through the zone, reclaim and hold.
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Execution: Entered near 11:00 AM with stop just above 6770.
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Outcome: +5, +10, +20 pts achieved. Final runner held.
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Lesson: Patience in choppy price action paid off. Manny admitted entering earlier than ideal but stuck to the plan, showing discipline and restraint—a strong reminder not to interfere with well-planned targets.
PTGDavid’s Operational Short Plays (A10 & OPR Shorts)
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Assets: ES, NQ, CL.
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Execution: Scaling in shorts across indices, managing them systematically.
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Result: All targets fulfilled, especially noted with the @NQ OPR Short.
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Lesson: Staying mechanical and trusting the A10/RSPR framework helped avoid false entries and losing trades, especially early on.
Key Lessons & Insights:
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System Discipline: PTGDavid highlighted how RSPR filters kept the room out of potentially losing trades, showcasing the importance of rule-based trading.
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Emotional Control: Manny’s note on emotions—“emotions can often lead to poor trade management”—was validated multiple times during the day.
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Market Awareness: Manny also pointed out SPX 6725 as a key gamma support, which ultimately led to a bounce—great use of broader market context.
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Adaptability: Manny skipped mid-morning chop due to lack of clean setups—knowing when not to trade is just as valuable as trading itself.
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Community Help: Great collaboration was seen with users like Slatitude39 learning the ATA system and others (like John B and Bruce F) offering support and chart confirmations.
Market Data Note:
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MOC Sell Imbalance: $4.2 billion by day’s end — a huge bearish signal.
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David noted the bears “owned today’s session,” and emphasized that tomorrow’s close could be a big tell for weekly direction.
Technical Zones Recap (from Manny’s Plan):
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6825–6829 Long: Triggered and worked early.
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6769–6773 LB&F: Provided the biggest win of the day.
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6800–6804 Resistance Sell: Never fully validated setup.
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OPR Shorts (NQ, ES, CL): Clean execution and full target hits.
Summary:
A solid day for disciplined traders. Despite early emotional challenges and choppy conditions, the room leaned on structure, patience, and the power of well-defined setups. Key trades from Manny and PTGDavid delivered great results, and the afternoon’s sell imbalance suggests continued caution into Friday’s close.
DTG Room Preview – Friday, October 31, 2025
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Market Rebound:
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U.S. indexes bounced overnight after strong earnings from Amazon (AMZN) and Apple (AAPL), offsetting META/MSFT-led selloff.
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Volatility remains elevated; ES 5-day ADR ticked up to 74.25.
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Amazon (AMZN):
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Beat on top/bottom lines; AWS growth beat expectations.
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AMZN up 13% AH.
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Trainium2 chip adoption +150% YoY; multibillion-dollar AI business.
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Project Rainier: 500K Trainium2 chip AI cluster launched.
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Partnered with Anthropic for AI exposure.
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Apple (AAPL):
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Beat on earnings; China sales soft.
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CEO Tim Cook said iPhone 17 demand is straining supply.
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Expects record December quarter revenue.
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Nvidia (NVDA):
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Market cap tops $5T.
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Supplying 260K chips to South Korea for sovereign AI push.
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Deals also in UAE, Saudi Arabia, Europe, UK.
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APEC announcements with Samsung, SK, Hyundai, NAVER.
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Macro Headlines:
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China’s PMI dropped to 49—6-month low; lowest new orders since 2023.
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Fresh calls for stimulus.
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Today’s Earnings Watchlist:
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Premarket: ABBV, AON, CNI, CG, CVE, CHTR, CVX, CHD, CL, D, XOM, LIN, LYB, MGA, NVT, RBC, SHG, TROW, GWW.
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Economic Calendar:
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Chicago PMI (9:45am ET).
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Fed speakers: Logan (9:30am), Bostic & Hammack (12:00pm).
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Gov’t shutdown enters Day 30—calendar remains light.
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Tech Levels (ES Futures):
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Resistance: 7005/10, 7050/55, 7340/45
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Support: 6823/28, 6705/10
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Whale Flow:
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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!!
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