Riley Retest Signals Reversal Amid Chaos

on April 1, 2025

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.

Follow @MrTopStep on Twitter and please share if you find our work valuable!

Our View

The day started out with new lows on the session, with the ES trading down to 5665.00 and printing a session low of 5333.00. It popped up to 5581, then immediately sold back off to the 5559 level. From that retest there was no looking back and rallied the rest of the day was higher highs putting in 139 points up from the low to 5672.70 by 3:44 PM.

Before that move, I posted this in the MTS chat:

IMPRO : Dboy (9:54:40 AM): too easy (to be short)
IMPRO : Dboy (9:55:35 AM): oversold, retail jumped all over this sell-off
IMPRO : Dboy (9:56:58 AM): they see all this shit on Twitter, it sells off, more people puke, hedges get put on, margin liquidation
IMPRO : Dboy (9:57:37 AM): run some buy stops now
IMPRO : Dboy (10:02:26 AM): trapped everyone short

That was the whole ball of wax right there!

I have to admit, I never thought the ES was going to rally that much. But as I’ve pointed out, this is all part of what’s shaping up to be a very long run of increased volatility. Everyone has their levels. I don’t know which service had the 5533.75 early low, but I saw it — and I’ll explain how I knew.

After the ES made its low, it upticked and then made a higher low. I call this the Riley retest. You could see it on the ladder: offers in the ES and NQ had shifted, bids were larger, and offers were thinner. When you have buy stops just above and the price action flips, it changes the direction.

Here’s an update from Goldman:

Most of the selling today is concentrated in mega caps, momentum, / AI , all down about 2.5%. Non-profitable tech is down 2.8%, and high short interest is down 3.5%. So anything momentum or speculative growth is taking the brunt of the selling.

Note: XBI is down 4.5%.

There are rotations underway, and they’re what you’d expect – defensive: staples, energy, utilities, and real estate are all up around ~1%+.

The equal-weight S&P is actually positive right now, with cap-weighted down 0.65%, a very wide divergence.

Our Lean

Goldman Takes Machete To Its Economic Forecast, Cuts S&P Price Target For 2nd Time In a Month, Sees S&P Ending 2025 At 5,700.

Blah, blah, blah… the banks have been worse at forecasting the S&P in the last few years than at any other time I can remember. If there was another comparable time, it was during the 2008 credit crisis.

I remember calling Vanguard and getting one of their research guys. I asked him what to buy, and he said buying in was not advised — and it rallied 150%. From the credit crisis lows, the S&P has rallied 750% and the Nasdaq has rallied 629%, including a 53% gain in 2023 and 2024.

Yesterday, the ES closed up 0.39% and the NQ was down 0.14%. When you consider the different time frames, the stock market doesn’t seem so bad.

Our lean: I still think you have to sell the rips. When people get bullish and the ES short covers, it usually fails. If the ES gaps lower, I would look to buy the early weakness and sell the big rips.

SpotGamma Free Webinar — 1:30 PM ET on April 2nd. Join to learn about their latest tools for dissecting the markets. Sign up now.

MiM and Daily Recap

The S&P 500 futures session opened the regular trading day at 5563.50 after a sluggish Globex performance that dipped to an overnight low of 5552.00. The early action saw a minor push higher pre-markt to 5570.00 at 9:07 AM, but that effort quickly reversed as sellers drove the index down through the open to a low of 5533.75 by 9:44 AM, losing 30.25 points (-0.65%) from the early open.

A swift reversal followed, taking ES to 5581.25 at 10:09 AM, marking a 47.50-point gain (+0.84%). Another pullback to 5559.25 at 10:24 AM (-22.00 pts) was met with steady buying, lifting the index to 5606.75 by 11:51 AM, registering a fresh high of the day and a +47.50-point gain from the prior low.

The market cooled slightly into midday, dipping to 5584.50 at 12:09 PM before mounting a renewed advance to 5617.75 at 12:47 PM. That was followed by another shallow retracement to 5595.50 at 1:10 PM, where support held firm.

The afternoon session brought renewed bullish energy, launching ES to 5640.25 at 2:16 PM—an impressive 44.75-point gain. Though a dip to 5625.75 at 2:35 PM softened the move, buyers stepped back in to lift prices to the session peak of 5672.75 by 3:42 PM, up 44.00 points from the preceding pullback low.

Late-day action turned choppy, with ES fading to 5640.75 at 3:51 PM before settling at 5656.25 into the 4:00 PM cash close. That marked a 92.75-point gain from the regular session open, or +1.67%. Relative to Friday’s cash close of 5633.50, the day’s move was +31.75 points (+0.56%).

The tone was decisively bullish throughout the regular session, with buyers consistently stepping in at higher lows and pushing toward progressively higher intraday highs. This strength was in stark contrast to the overnight session, which posted a $C–C loss of 60.75 points (-1.08%), indicating that regular-hours buyers fully reversed the overnight weakness.

Volume supported the strength, with the regular session printing 1.675 million contracts and full-session volume reaching 2.09 million.

The Market-on-Close imbalance at 3:50 PM showed $14.87B in total notional, with an overwhelming 90% symbol imbalance favoring buyers—well above the ±66% threshold for a notable skew. This sizable buy imbalance helped underpin the market into the close and likely contributed to holding ES near session highs despite some late-day profit-taking.

In summary, Monday’s action demonstrated strong institutional buying interest during regular hours, effectively shrugging off Globex weakness and closing the session firmly higher. With momentum skewed positively and a notable MOC buy bias, bulls maintain the upper hand heading into Tuesday’s trade.

How to read the MIM

Technical Edge

MrTopStep Levels:

Fair Values for April 1, 2025:

SP: 44.36
NQ: 175
Dow: 282.17

Daily Market Recap 📊

NYSE Breadth: 61% Upside Volume
Nasdaq Breadth: 34% Upside Volume
Total Breadth: 41% Upside Volume
NYSE Advance/Decline: 50% Advance
Nasdaq Advance/Decline: 34% Advance
Total Advance/Decline: 40% Advance
NYSE New Highs/New Lows: 51 / 276
Nasdaq New Highs/New Lows: 70 / 702
NYSE TRIN: 0.74
Nasdaq TRIN: 1.02

Weekly Market 📈

NYSE Breadth: 42% Upside Volume
Nasdaq Breadth: 51% Upside Volume
Total Breadth: 48% Upside Volume
NYSE Advance/Decline: 35% Advance
Nasdaq Advance/Decline: 29% Advance
Total Advance/Decline: 31% Advance
NYSE New Highs/New Lows: 112 / 204
Nasdaq New Highs/New Lows: 187 / 610
NYSE TRIN: 0.83
Nasdaq TRIN: 0.88

Trading Room Summaries

Polaris Trading Group Summary – Monday, March 31 , 2025

Positive Trades and Highlights:

Overview:
The final trading day of Q1 delivered a dynamic session filled with early chop, strong afternoon movement, and a massive end-of-day MOC imbalance. PTGDavid guided the room with precision through tricky market conditions, highlighting key zones and bullish opportunities, especially during the midday and into the close.

Morning Session:

PTGDavid emphasized a “long shift” bias, with dip-buying strategies encouraged early.
The ORR Mid at 5560 held perfectly, acting as a key support level.
Despite that support, the market was stuck in heavy chop throughout the late morning, as described by David: “zoom zoom…going nowhere.”
David marked the session as “two-way chop” with “lots of cross-currents,” a good reminder to stay nimble and avoid overtrading.

Midday to Afternoon Highlights:

Around 11:25 AM, David noted bulls gaining control, shifting to a “longs only” bias.
Dips remained buyable, but traders were warned “not to overstay your welcome.”
The gap fill was achieved as bulls pushed to reclaim prior lows, a bullish confirmation into the afternoon.

Power Hour and Close:

At 2 PM, the market lit up with a “Shake n Bake ripper”, sparking strong bullish movement — a solid trading opportunity for those positioned long.
David humorously noted that A4 had a “sword fight”, while A10 held firm, reinforcing the importance of zone structure awareness.
With End of Month (EOM) and End of Quarter (EOQ) window dressing underway, traders were primed for volatility.
The MOC (Market on Close) imbalance was huge — $14.144B Buy, one of the largest David has ever seen.
This imbalance was partially paired down to $4.7B, but still provided a strong end-of-day push.
As always, David wrapped with some humor: “Hit the bid! Smack it and crack it!” — closing the quarter with energy and insight.

Lessons & Takeaways:

Adapt to chop: Recognizing chop early helped traders avoid getting chopped up mid-morning.
Zone reliability: The ORR Mid 5560 was a textbook support play.
Stay patient: Real movement came in the afternoon, rewarding disciplined long setups.
Understand market mechanics: The MOC imbalance taught valuable lessons about institutional flows and their impact into the close.

Final Note:
A successful EOM/EOQ session with valuable lessons in patience, discipline, and execution. Kudos to PTGDavid for steering the room through a tricky open into a high-opportunity close.

Discovery Trading Group Room Preview – Tuesday, April 1, 2025

Macro / Market Overview
- Markets recovered intraday losses Monday but still ended Q1 with the worst performance since 2022:
  - S&P 500: -4.5% Q1
  - Nasdaq: -10% Q1
  - Nvidia (NVDA): -20% YTD
  - Tesla (TSLA): -35% YTD
- Volatility climbed for the second consecutive day; ES 5-day ADR at 94.5 pts
Energy / Commodities
- Oil surged over 3% to settle above $75 after Trump threatened 25%–50% tariffs on nations buying Russian oil unless peace talks resume
- Trump also threatened the use of force against Iran over nuclear talks
- Gold continues setting new all-time highs
Policy / Fed
- Most traders view Trump’s threats as negotiation tactics, but energy markets are reacting strongly
- NY Fed’s Williams expects interest rates to remain unchanged “for some time”
  - Warned that tariffs could result in long-term inflation pressures
- Commerce Secretary Lutnick may withhold Chips Act grants to push for more U.S. investment
  - TSM announced an additional $100B in U.S. plant commitments on top of a prior $65B pledge
Sector Highlights
- Trump’s auto tariffs (effective April 2) are prompting a surge in vehicle purchases
  - A 25% tariff could add $10K to the average $40K foreign vehicle price, raising monthly payments ~$300
- Lucid begins selling its Gravity SUV with deliveries in April
  - Experiencing demand surge, possibly driven by backlash toward Tesla CEO Elon Musk
  - Targeting production of 20,000 vehicles in 2025
- NewsMax IPO spiked 735% to close at $83.51 on day one
  - Largest single-day IPO surge in nearly 3 years
  - May become a meme stock as retail drives volume
  - Financials show $55M in H1 2024 losses, $142M liabilities vs. $69M assets
Economic Calendar (ET)
- 9:00 AM – Richmond Fed’s Barkin speaks
- 9:45 AM – S&P Global Manufacturing PMI
- 10:00 AM – ISM Manufacturing PMI, ISM Prices Paid, JOLTs Job Openings, Construction Spending
Trade Setup
- Whale bias leaning bullish into the U.S. open on borderline significant volume
- ES formed a clean swing low Monday, but more confirmation needed
- Monday’s HOD and overnight highs rejected at prior support TL, now acting as resistance
- Key TL resistance levels: 5668/63s, 5779/74s, 5893/98s, 6212/07s
- Key TL support levels: 5532/29s, 5461/56s, 5339/34s
No notable corporate earnings today.

ES -Week to Week

The bull/bear line for the ES is at 5633.25. This is the key pivot that separates bullish from bearish sentiment. Currently, ES is trading below this level at 5629.75, suggesting slight early-session weakness.

If the price remains below 5633.25, downside targets to monitor include support at 5590.00, followed by the lower range target of 5558.75. A further break could expose deeper support at 5533.75 and 5488.75.

To the upside, bulls need to regain and hold above the bull/bear line to confirm strength. Immediate resistance stands at 5672.75, followed by the upper range target of 5707.75. A push above that would put 5777.75 in play as a major resistance zone.

Momentum favors buyers on a reclaim of 5633.25. Until then, caution is warranted below this level, with sellers likely to defend any push higher unless buyers step in aggressively near the open.

NQ – Week to Week

The bull/bear line for the NQ is at 19,357.00. This is the key pivot that must be reclaimed for bullish momentum to resume. Price action below this level continues to favor sellers intraday.

Currently, NQ is trading around 19,366.25, just above the bull/bear line. A sustained hold above this level targets yesterday’s high at 19.489.75 which opens the door for a move toward 19,683.50, our upper-range target for today. Above that, watch for resistance at 19,901.25 (the moving average), which also aligns with psychological round-number resistance near 19,900.00.

If NQ fails to hold above 19,357.00, look for downside pressure to reemerge. The first support level is at 19,308.25, followed by a stronger support zone around 19,030.50 and 18,976.80 — the lower-range target. A breakdown below this zone could drive prices toward 18,723.00.

Intraday sentiment hinges on the 19,357.00 bull/bear line. Stay nimble around this level, and watch for momentum shifts tied to how price behaves around it.