Swashbuckling Week Ends Quietly: ES Holds Steady Despite Quad Witching

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It was a swashbuckling week for the futures index markets, and come 3:30 on FRYday, I was glad it was coming to a close. Despite all the movement, the ES traded in another inside day, closing up a modest 0.13% with 1.468 million contracts traded and settling at the 5720.00 level. The NQ was up 0.46% at 19,970.75, with nearly 600k contracts traded.

First, I want to address the mistake I made about a “big sell” on Friday’s close. A very good friend who worked at BofA was explaining what he thought about the expiration. I was doing my best to take notes but he was talking too fast and I misinterpreted what he was saying. I don’t know if I’m getting old or just couldn’t keep up as I typed my notes.

I told the PitBull what he said and after he spoke to the former trader, it turned out it was not for sales late in the day—he was looking for a big buy. The PitBull was not very happy with me. I corrected it in my chat and on Twitter. I could explain where the snafu came from, but it’s water under the bridge now.

Here’s what I posted in the MTS chat to correct the mistake:

As I’ve said many times: no one knows for sure what the ES is going to do next. Some days are easier to predict, but it’s never going to do what most people want it to do when they want it. It takes extreme patience and perseverance to make money, and if you have those qualities, it goes a long way.

After my debacle Thursday, I made a few small buys early Friday after the open, but again I took some very small losses.

I came back at 3:30, made two small trades that lost a few points, and then caught the MIM move:

I’ve always believed—especially during the quarterly Quad Witching and in my own daily trading—that the best trades of the day show up in the first and last hour. Had I been able to hold those opening buys, I would’ve caught both hours.

According to the Stock Trader’s Almanac, the week after Quad Witching has the Dow down 22 of the last 37 occasions. March is historically weak going into quarter-end.

One concern I have after being down four weeks in a row is the longer-term effect of Trump’s Department of Government Efficiency (DOGE) cuts, and how they’ve jeopardized small businesses, private contractors, and the labor market. I think the answer for the stock market is easy—you just have to look at the record outflows from the US stock market to Europe.

I think another problem is that we know that Musk’s audit of U.S. Government programs is finding billions of dollars in fraud and all the programs being cut. The problem is that all this job loss could cause economic turmoil and, ironically, help Trump’s playbook: a recession.

The Republicans are taking heat. Multiple polls suggest that while voters are open to the broader idea of federal downsizing, they’re concerned about how it’s being implemented. Tens of thousands of federal employees have been fired or accepted what amounted to a buyout offer from the administration.

While the White House and Musk have been pushing DOGE as a huge success, public sentiment is shifting. A February Harvard CAPS/Harris poll found 72% of voters supported a government agency focused on efficiency, and 60% thought DOGE was “helping make major cuts.” But recent polling paints a different picture:

I have no idea how this ends, but what I do know is that a lot of people are pissed off. I still think we are going to see a return of the Fed’s QE.

I think we all know the stock market hates uncertainty and the bottom line is there’s an abundance of that right now.

Trump’s April tariff deadline is coming up fast on April 2nd, just 7 trading days away. I think the headlines are going to start back up again this week.

Our lean: This week has 14 economic reports, and the Fed blackout period is over. Richmond Fed President Tom Barkin speaks Thursday at 4:30, and the PCE number drops on Friday.

Trump hinted at “flexibility” for China and U.S. trading partners in his plan to impose blanket tariffs April 2nd.

There’s no doubt some of the Mag 7 stocks have improved. My guess is, with the $8.5 billion bought on the close Friday, we could see a higher price on Globex. But as I posted Friday, the week after March Quad Witching has the Dow down 22 of the last 37 times, and March tends to be weak late in the month.

If the ES can take out the March 5770 level and hold above, the next levels are 5786, 5808. I like trading the gaps—so if we have a big gap in either direction, I’ll be watching it.

Here are a couple of ZeroHedge stories to check out:

Higher For Longer With Tariffs, Port Fees, And German Spending

Retail Army Piles Into Tesla At Record-Breaking Pace

MiM and Daily Recap

The ES futures market saw substantial volatility during Friday’s Quad Witching OPEX session, marked by significant intraday swings. Overnight Globex trading initially began with modest weakness, hitting an early low of 5692.00 by 7:54 AM. Prices quickly recovered, reaching a morning high of 5703.25 at 8:12 AM. However, the rally faded sharply, leading to a steep decline and an intraday low at 5651.25 at 9:27 AM, reflecting a significant drop of 52.00 points (-0.91%) from the earlier peak.

As the regular cash session opened at 9:30 AM at 5664.00, the ES began to stabilize, climbing briefly to 5675.75 at 9:57 AM before retracing again to a higher low at 5652.25 by 10:09 AM. Renewed buying interest supported prices to push upward to a significant high at 5691.00 by 11:00 AM. This optimism was short-lived, as a notable midday pullback took prices down to another key support level at 5658.75 around 12:00 PM.

The afternoon session saw momentum shift positively again, driving the ES to a robust intraday high of 5710.00 by 12:57 PM. Although prices experienced fluctuations throughout the afternoon, establishing another interim low at 5687.75 at 1:30 PM, bullish momentum persisted, resulting in another session high at 5712.50 at 1:51 PM. After a slight dip to 5693.50 at 2:27 PM, the ES recovered briefly to 5706.25 by 2:42 PM before retreating once more to a late-session low at 5688.25 at 3:09 PM.

Late afternoon action saw strong bullish participation, pushing the ES to its highest level of the day at 5722.25 at 3:57 PM, demonstrating robust buying in the closing minutes. The regular cash session closed at 5714.50, marking a gain of 50.50 points (+0.89%) from the open and unchanged (0.00 points) from the previous day’s cash close. The session ultimately settled slightly higher at 5720.00 during the cleanup period.

Market sentiment during the day was marked by heightened volatility due to the Quad Witching expiration event. Trading volume was robust, totaling over 1.46 million contracts for the full session. Market-on-Close (MOC) data reflected significant activity, with total imbalance dollars reaching $6.591 billion. However, the symbol imbalance was moderate at -51.9%, below the ±66% threshold required for strong directional significance. This large MOC figure underscored significant position adjustments rather than a clear directional bias, leaving traders with a cautiously neutral stance as the session closed.

How to read the MIM

Technical Edge

Fair Values for March 24, 2025:

Daily Breadth Data 📊

Weekly Breadth Data 📈

Room Summaries:

Polaris Trading Group Summary Friday, March 21, 2025

Friday’s session was shaped by classic OPEX behavior—tight ranges, low momentum, and limited directional follow-through. The morning started strong with the Daily Trade Strategy again proving accurate. ES and NQ both hit their downside bear targets early, with ES reaching the 5700–5695 zone and NQ touching 19780–19760. This fulfilled the expected average decline for Cycle Day 1 down to 5674.25.

Key Highlights:

Afternoon Session:

The midday stretch brought minimal movement. David stepped away for a while with charts still running, noting the lack of opportunity. Power Hour brought some typical OPEX “shenanigans,” but without a clear edge, David chose to sit out. Although a large Market-On-Close imbalance of $8.5 billion developed, he remained on the sidelines, emphasizing that it wasn’t his setup.

Lessons and Takeaways:

Today underscored the importance of understanding the trading environment. OPEX sessions often produce erratic, range-bound behavior not suited to breakout strategies. Scalpers had the best chance to perform in today’s two-way action. David reinforced the value of emotional discipline by sharing advice on how to handle the feeling of missing a trade. His end-of-day decision to stand aside despite a tempting MOC imbalance served as a reminder to trade only when your edge is present.

Summary:

While Friday didn’t deliver trend moves, it rewarded traders who adapted to range conditions. The room demonstrated strong planning, discipline, and flexibility. The early bear targets were the day’s highlight, and the rest of the session was a masterclass in patience and not forcing trades. A solid end to the week.

DTG Room Preview – Monday, March 24, 2025

Calendars

Economic

Important events for the rest of the week:

S&P 500 Earnings

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Full MTS Calendars

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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!