on March 14, 2025

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S&P Caught in a Triple Threat: Tariffs, Rolls & Expiry

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Our View

Well, the ES and NQ have made new lows for this move down. Am I surprised? No. As I have always said, no one knows what the S&P is going to do next, all we can do is follow the trend, and for the last three weeks, it’s been down.

The ES made a new low at 5509.25 and the NQ dropped all the way down to 18,170.00. The only thing I keep coming back to is how much ‘over-investing’ went into the Mag 7 and friends and how painful it must be seeing the tech sector fall as it has. The big question is, when will it stop? I have an old saying: “the S&P never does what most people want it to do when they want it!”

After the low, the ES traded up to 5557 and the NQ up to 19,396 before both pulled back to just above their respective lows. These markets are unhinged, and it’s headlines like these that make them go berserk:

#Trump: I won’t bend on Canada metals or April 2nd tariffs.

“A recession is worth it.” Those shocking words came straight from Trump’s Commerce Secretary, Howard Lutnick.

#USPS: We plan to reduce the workforce by 10,000 employees in the next 30 days through a voluntary early retirement program – Letter to Congress.

There is a constant barrage of these headlines, and not only are they disruptive, but who knows if any of this is going to work. Both the ES and NQ reversed back down close to the lows as the 3:50 imbalance came out small to buy, flipped to small to sell, and then started to bounce at 3:59, setting up the move up to 5568.00 on Globex early last night.

April gold 3K. Bonds rallied. Bitcoin got down to 79,910.

PitBull: we are down to where we can have a wicked rally.

@Mr_Derivatives 🚨 Heisenberg Observation 🚨 $SPX The 2020 March Covid Crash from peak to trough never had consecutive green days. Not one. Until it bottomed. This current drawdown from peak to current trough, we have not had consecutive green days. Not one (yet). Interesting parallel…

Our Lean

The Fed blackout this week has been great; it started on Saturday, March 8, and runs through Thursday, March 20. This morning, we have a lone economic report—Consumer Sentiment at 10:00—along with the Week Two Friday options expiration. Despite the CME pushing the start of the rollover to Monday, many accounts are already rolling.

Since its February 19 high, the S&P has lost an estimated $5.3 trillion, dropping from a high of about $52 trillion. The Nasdaq suffered a correction last week and is now down more than 14% from its December high. The Dow has fallen more than 9% from its own record, and the ES fell into correction territory for the first time since 2023.

There isn’t much to be cheering about, but Senate Minority Leader Chuck Schumer (D., N.Y.) said he would vote to advance a Republican measure, set for Friday afternoon, to fund the government through the rest of the year.

Our lean: There is all sorts of talk about a rally, and I agree that the index markets are oversold, but even if we do bounce, it’s not going to shake off all the negatives. I could be totally wrong, but that would mean the non-stop sell program in the NQ would be over or at least paused. I think that’s wishful thinking.

The PitBull reminded me that his rule is to look for a low on the Thursday or Friday the week before the March Quad Witching—not just Thursday. I can’t rule out buying a pullback, but I still think selling the big rips is a working pattern. Until we see an upside breakout that actually holds above 5600, I’m still selling the rips.

That said, a 10% decline in the ES could bring in buyers, but as I mentioned, the NQ would have to cooperate.

MiM and Daily Recap

Overnight price action (Globex session) saw the ES hover near 5598.00 heading into the morning. In pre-market trading around 8:12 AM, futures briefly dipped to 5575.25, registering a mild pullback of 22.75 points (-0.41%). By 8:30 AM, buyers lifted prices to 5604.00 with the release of PPI data, setting a short-lived pre-open high (a 28.75-point, or +0.52%, upswing from 5575.25).

The regular session opened at 9:30 AM at 5598.00. Shortly after the bell, sellers emerged and pressured the market down to 5556.75 near 9:57 AM (a 47.25-point, or -0.74%, decline from the open). A rebound ensued, bringing the ES back toward 5603.75 by 10:24 AM, nearly matching the pre-market high and establishing the high of the day (47.00 points, or +0.84%, above that 9:57 AM dip). As the morning progressed, upward momentum faded.

Midday trading proved decidedly weaker. A fresh low of 5534.25 formed at 12:30 PM, a 69.5-point drop (-1.24%) from the 10:24 AM high. A modest bounce to 5558.75 by 12:39 PM recovered 24.5 points (+0.44%). However, that move quickly stalled, and the ES tumbled further to 5509.25 at 1:48 PM, shedding 49.5 points (-0.89%) from the earlier bounce and marking the session’s low of the day.

The afternoon featured another attempt by buyers, propelling the market to 5559.00 by 3:00 PM (a 49.75-point, or +0.90%, rise off the day’s low). That rally soon faltered, leading to a decline toward 5514.00 near 3:51 PM (45.00 points lower, -0.81%). Prices managed a final push to 5545.00 around 4:15 PM, adding 31.00 points (+0.56%) before drifting slightly lower into the close. The regular-session settlement printed at 5528.25, marking a net loss of 74.50 points (-1.33%) from the prior day’s cash close. From the 9:30 AM open to the final print, the ES shed 69.75 points (-1.25%). Volume was robust, with 1,489,115 contracts traded during regular hours and 1,879,355 overall.

Bearish sentiment dominated much of the session, as early attempts to hold higher levels quickly succumbed to steady selling pressure, partly driven by persistent tariff chatter. While the afternoon bounce offered a degree of stabilization, the inability to maintain gains reinforced a cautious tone. Repeated selloffs into midday and late afternoon underlined the conviction of sellers.

Market-on-Close (MOC) and MiM data revealed a total imbalance of -87 million dollars, with a dollar percentage of -51.1%. This relatively neutral distribution was still considered bullish enough to help spark a 30-point rally into the close over the final 20 minutes.

How to read the MIM

Technical Edge

Fair Values for March 14, 2025

SP: 4.67
NQ: 17.26
Dow: 36.68

Daily Breadth Data 📊

NYSE Breadth: 28% Upside Volume
Nasdaq Breadth: 29% Upside Volume
Total Breadth: 29% Upside Volume
NYSE Advance/Decline: 28% Advance
Nasdaq Advance/Decline: 26% Advance
Total Advance/Decline: 27% Advance
NYSE New Highs/New Lows: 16 / 183
Nasdaq New Highs/New Lows: 43 / 383
NYSE TRIN: 0.98
Nasdaq TRIN: 0.90

Weekly Breadth Data 📈

NYSE Breadth: 29% Upside Volume
Nasdaq Breadth: 34% Upside Volume
Total Breadth: 32% Upside Volume
NYSE Advance/Decline: 27% Advance
Nasdaq Advance/Decline: 32% Advance
Total Advance/Decline: 30% Advance
NYSE New Highs/New Lows: 30 / 83
Nasdaq New Highs/New Lows: 54 / 193
NYSE TRIN: 0.95
Nasdaq TRIN: 0.91

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

What’s Happening in the Market

Equities just couldn’t catch a bid today, after some early positive momentum was zapped by comments by Putin on war & Trump on tariffs.

That led the SPX to a low of 5,500, which served as support. This is also our key support line into next weeks OPEX.

Despite this “failure to bid”, we were steadfastly unimpressed by downside options bets. Below is the equity basket in HIRO, which was indeed negative, but a rather unimpressive -$1.8bn (-$5bn is 30 day high). The S&P500 index basket showed HIRO delta mildly higher on the day.

Arguably more telling was the volatility dynamic, wherein SPX fixed strike vol is lower in the face of the equity selling.

The implication here is that the selling equity positions as opposed to holding those positions and trying to hedge. On this point is a very consistent pattern of equities selling from the open until ~11AM (ie Euro close). This selling isn’t sparking any change in vol/skew dynamics, giving one the impression that when this flow backs off we can possibly catch an equity bid. We state this fully aware that our (incorrect) view both yesterday & today was “equities setup for a rally”.

The point is that if equities are going to shift lower but vol doesn’t respond – well we aren’t too panicked about downside.

On the topic of “where is the options flow”, we turn to Gold, and the epistemological question: “If a tree falls in the woods, does’t it make a sound?”

In this case, though: “If gold makes new highs, does anyone care?”

Today was fresh all time highs, and we see GLD skew rank at just 15 (low!) and IV rank at 40 (average). Today’s option volume was 438k vs an average of 250k, but HIRO registered a ZERO on flows today, particularly anything tied to an expiration past next week.

We’re willing to bet that call buyers wake up to these highs at some point, which could present some interesting long opportunities.

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

Trading Room News:

Polaris Trading Group Summary – Thursday, March 13, 2025

Morning Session: Cautious Start with Neutral Opening

The session opened with neutral conditions, leading to a wait-and-see approach for directional bias.
Economic data showed Initial Jobless Claims slightly better than expected and PPI YoY in line with forecasts, contributing to early indecision.
Traders were reminded that inside neutral openings can be difficult and require patience.

Early Trade Action: Bearish Expectations Fulfilled

@NQ OPR short targets were hit, aligning with the Cycle Day 1 expectation for a decline.
@CL (Crude Oil) also saw a short target hit, with stops trailed on the remaining position.
Price tested key levels, particularly ONL 5560 and PL 19395 on the Nasdaq, looking for a reclaim.

Mid-Morning: Market Reversal and Bullish Attempts

The PKB Long setup played out, with price reclaiming prior levels and successfully testing support.
Barbara Lopez noted a potential market reversal around 7:00 AM PT, a pattern she has observed in indecisive openings.
This insight proved valuable as a rally followed, providing a good lesson in recognizing timing-based setups.

Late Morning: Bulls Struggling for Control

Bulls needed confirmation and control (C&C) of the Open Range to sustain any upward move.
Despite attempts, the “Whack-a-Mole” effect was in play, with every pop getting slammed by sellers.
The market completed Cycle Day 1 low projection at 19345.50 on the Nasdaq, fulfilling the day’s bearish expectations.
Discussion centered on whether bulls could build a base and absorb selling pressure to set up for the next leg.

Afternoon: Shakeout and Late-Day Moves

A “2 PM Shake n Bake” move occurred right on schedule, leading to a bounce.
However, bulls struggled as price failed to reclaim key resistance zones (5500-5560).
A Money Box Reversal provided a strong move, but no decisive breakout occurred.
The market attempted to close back inside the prior range, which would be a small victory for bulls.

Closing Thoughts: Late Rally After Hours

The MOC was flat, showing no strong push into the closing session.
However, right after the cash close, a rip finally happened, catching late traders off guard.

Key Lessons & Takeaways:

Patience in neutral openings is crucial. Waiting for a clear directional move before committing helps avoid early mistakes.
Pattern recognition can provide high-probability setups, as seen in Barbara’s 7 AM PT insight.
Cycle Day projections remain a reliable guide, with the bearish expectation being met.
The “Whack-a-Mole” market showed how short-term rallies can be suppressed, requiring discipline in entries.
Significant moves can happen after the cash close, reinforcing the importance of watching price action beyond regular hours.

Overall, a solid execution of strategy with patience paying off as traders followed the setups rather than forcing trades.

DTG Room Preview – Friday, March 14, 2025

Equities: The S&P 500 closed down 1.4%, officially entering correction territory from its February highs. Nasdaq followed suit with declines.
Gold: Prices surged to an all-time high of $3,000/oz as safe-haven demand spiked.
Trade & Policy: Market focus remains on Trump’s aggressive tariff stance, with threats of 200% tariffs on EU wines escalating the trade war.
Government & Debt: A last-minute bill is likely to prevent a government shutdown this weekend. However, the U.S. debt ceiling will be reached this summer, with discussions on raising it already underway.
Tax Cuts: Republican senators are pushing a major tax cut package, following House approval.
Corporate Earnings: Dollar General (DG) exceeded Wall Street estimates, attributing growth to lower-income consumer spending. Rockwell Automation (ROK) also reported premarket.
Economic Calendar: Key data releases at 10:00 AM ET include UoM Consumer Confidence and UoM Inflation Expectations.
Market Volatility: ES 5-day average daily range remains at 139.75 points, indicating sustained volatility.
Trader Sentiment: Whale bias leans bullish ahead of the U.S. session open, though overnight large trader volume was lighter.
Technical Levels (ES):
- Resistance: 5624/19s, 5881/76s, 6158/53s
- Support: 5512/09s, 5456/51s
- The ES downtrend channel bottom held Thursday’s lows, while the short-term downtrend channel top at 5624/19s could act as resistance today.

ES – Week over Week

The bull/bear line for the ES is at 5543.00. Price is currently trading near 5574.25 in the Globex session, signaling a slight bullish bias above this key pivot. If buyers maintain strength above 5543.00, initial upside resistance appears at 5596.50, followed by 5635.25 (our upper range target). Beyond that, watch 5722.00 and 5788.00 as potential resistance zones.

On the downside, a break back below 5543.00 would shift focus to support at 5500.75 and 5450.75 (our lower range target). Failure to hold above 5450.75 opens the door to further selling pressure, eyeing 5364.00 as the next significant support.

Our longer term bull bear line sits at 5,885.25 if prices moved above that we would be more favoring longs for swings.

NQ – Week over Week

The bull/bear line for NQ is at 19,322.25. With the last Globex candle currently around 19,464.50, NQ is trading above this key pivot. If buyers can maintain support above 19,322.25, look for a push toward 19,723.00, our upper range target for the session. A break above that level opens the door to further upside, with 20,100.30 and 20,305.00 as the next resistance zones.

On the downside, losing 19,322.30 could invite selling pressure toward 19,142.00 and then 19,063.30. Below these levels, 18,921.50 is our lower range target, and a clear break there exposes deeper support near 18,544.30. Use caution if momentum turns bearish under the bull/bear line; expect further downside follow-through if sellers gain the upper hand.

Our long-term Bull/Bear line sits at 20,835. As long as we are below that line we favor shorting rips, particularly if they are below the 19,322 for today.