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.
Tariff Drums and Thin Tape: Markets Await a Catalyst
Follow @MrTopStep on Twitter and please share if you find our work valuable!
FREE Two-Week Offer for the Opening Print Premium. Open up the Lean and other premium features for the next Two Weeks!
Our View
The ES and NQ are in rest/back-and-fill mode. The week after the 4th of July (from what I remember) is slow, and both Monday’s and Tuesday’s trade was just that.
I used to like to trade the narrow chop, but the 4 to 6-point intraday moves are too hard to trade. I think there are a lot of reasons for this, but the main one is how far the markets have rallied in such a short period of time and tariff uncertainty, which doesn’t seem to be moving the markets around like they were.
The other part of this is that we are heading into the middle of summer, and it seems like there is a lot more interest in taking time off than getting spun around trading the ES and NQ.
The ES’s trading range was 6254 up to 6289, a 35-point range, with most of the late-day trade in a 6 to 8-point range. It settled at 6270.50, down 0.08%.
Part of the weakness came from Trump’s comments about the U.S. not offering extensions to the August 1 deadline for reciprocal tariffs to take effect and announcing 50% tariffs on copper. Commerce Secretary Howard Lutnick said that some 15 to 20 world leaders would soon get letters warning them what potential tariffs they could face if they failed to reach trade deals with the U.S. South Korea and Japan have already received the warning letter, and last but not least, BRICs nations will pay an additional 10% tariff charge.
What the ES needs is some further back and fill, even if it comes from lower levels. The shorts have been wiped out, and by all rights, we could and should see a larger pullback. But with the volume so low, it’s hard to stay short.
Another thing is the lack of economic reports and Fed speak. Wholesale inventories is the lone 10:00 economic report, and the May Fed minutes are at 2:00.
In the end, it was another low-volume, narrow-range trade. In terms of the ES’s overall tone, I can’t say the ES’s -0.08% decline changed things much. If there was anything that sticks out, it’s the yield on the 10-year note traded up to a two-week high at 4.42%, definitely something to keep an eye on.
In terms of the ES’s overall trade, volume was low at 1.031 million contracts traded.
Our Lean
I don’t see much changing today. It should be another slow day with Trump beating the tariff drums.
Our lean: I can list several ES levels, but the most important one right now is the 6250 area. If the ES gaps lower, my lean would be to buy the open or the first pullback under the lower open. If the ES gaps 10 to 20 points higher, I would look to be a seller.
I will add that, based on the ES’s price action, it would not take much to whack out the support and run some stops.
From Jeff Hirsch @AlmanacTrader
BULLISH BEFORE JULY 4th, BEARISH AFTER
Trading the three days ahead of the July 4th Independence Day holiday has historically been stronger than the days after the holiday. Trading on the day before and after the holiday is often lackluster. Volume tends to decline on either side of the holiday as vacations begin early and/or finish late. Since 1980, DJIA, S&P 500, NASDAQ and Russell 2000 have recorded net losses on the day after.
This has become more pronounced in recent years and was the case again last year. However, over the past thirteen years since 2011, trading after Independence Day has softened notably. DJIA has declined ten times in 14 years on the day after. S&P 500 has slipped eight times. Average performance remains fractionally positive. NASDAQ and Russell 2000 have more up days after the 4th, but R2K averages losses the two days after.
Guest Posts — Polaris Trading Group
Prior Session was Cycle Day 2: Normal CD2 as price consolidated range bound throughout the session in what was coined as “Hot Dog Day!”
Contraction of range and volatility, typical of a hot mid-summer trading did not disappoint. It was clearly a day for seasoned veteran traders to sit back and watch all the “retail speculators” battle it out.
One of the key teachings of PTG is to “Know Your Mil”…meaning know your strategy and what conditions are most favorable to extract the greatest potential performance. When those conditions are absent, then there is nothing more to do than “grab a hot dog and sit it out in the stands.
Range was 34 handles on 1.030M contracts exchanged.
FREE TRIAL link to PTG/Taylor Three Day Cycle
For a more detailed recap of the trading session, click on this link: Trading Room RECAP 7.8.25
…Transition from Cycle Day 2 to Cycle Day 3
Transition into Cycle Day 3: Summer volumes and volatility have arrived with the Fourth of July Celebration in the rearview mirror.
Tariffs are now the ongoing main-driver, although markets are calmly consolidating coming off the recent all-time high print. Seems the BIG$ MONEY decision-makers are in a “wait n see” mode on the readthrough effect of tariff negotiations, or in some cases “PAY the VIG!” (You Know What I am talking about…Don Vito Corleone).
For Cycle Day 3 (CD3) price is securely above the CD1 Low (6246.25) which has a 90.77% historical Positive 3-Day Cycle performance record.
Of course, nothing changes for PTG…Simply follow your plan. Take only Triple A setups and manage the $risk. ALWAYS HAVE HARD STOP-LOSSES in-place on the exchange.
PTG’s Primary Directive (PD) is to ALWAYS STAY IN ALIGNMENT with the DOMINANT FORCE.
As such, scenarios to consider for today’s trading.
Bull Scenario: Price sustains a bid above 6270+-, initially targets 6290 – 6295 zone.
Bear Scenario: Price sustains an offer below 6270+-, initially targets 6255 – 6245 zone.
PVA High Edge = 6280 PVA Low Edge = 6270 Prior POC = 6273
ESU
Thanks for reading, PTGDavid
MiM and Daily Recap
Intraday Recap
The session began with muted overnight trade before the cash open. The Globex high was established early at 6289.00 before price pulled back modestly. As the regular session commenced at 9:30 AM ET, ES opened at 6281.00.
The morning session proved to be a roller coaster of repeated 12-point swings, as the market traced a series of lower highs and lower lows. Sellers and buyers exchanged control in rapid succession, producing sharp moves both ways. By 10:55 AM, this back-and-forth culminated in the low of the day at 6262.75, following a sequence of rallies and fades, including a notable 20-point down-up-down pattern that pressured the contract to fresh intraday lows.
From this oversold area, buyers mounted a strong recovery. ES climbed sharply to 6288.75 at 12:55 PM, marking a 68.25-point rally (+1.10%) off the session low and establishing the high for the regular trading hours. The upswing proved short-lived, as price reversed and retreated to 6265.75 by 13:15 PM, erasing 23.00 points (-0.37%).
Midafternoon trade turned choppy. A modest rebound brought ES back to 6280.75 at 13:55 PM, followed by a fade into late-day weakness. The market set a lower low at 6267.50 near 15:50 PM, reflecting renewed selling into the close.
On a session basis, the Globex trade recorded a net gain of 18.50 points (+0.30%) from its open to close. The regular session settled at 6270.50, a decline of 10.50 points (-0.17%) from its open and down 5.00 points (-0.08%) relative to the prior cash close. The final cleanup session added a modest 1.25 points (+0.02%), bringing the full session settlement to 6271.75.
Volume was moderate during the regular hours, with 878,597 contracts traded, contributing to a total daily volume of 1,030,924 contracts across all sessions.
Market Tone & Notable Factors
Overall sentiment was mixed to bearish, characterized by repeated failures to hold intraday rallies and a decisive midmorning liquidation that briefly pushed the contract under 6225. Despite the robust recovery into midday, sellers reasserted control in the final hours, capping gains and pressing the close below earlier highs. A low volatility summertime consolidation day.
Market-on-Close imbalance data showed a total imbalance of $1.140B, with 60.7% of the flow on the buy side. However, the symbol imbalance ended at -52.2%, indicating more symbols with sell interest.
In summary, the day produced a net decline of 5.00 points (-0.08%) from the previous cash close, with notable two-way swings driven by positioning rather than clear directional conviction. The inability to sustain the midday rally highlights caution among buyers. Participants will likely watch for follow-through in either direction during the next Globex session to gauge conviction heading into week’s end.
Technical Edge
Fair Values for July 9, 2025:
-
SP: 44.36
-
NQ: 189.35
-
Dow: 256.09
Daily Market Recap 📊
For Tuesday, July 8, 2025
-
NYSE Breadth: 60.6% Upside Volume
-
Nasdaq Breadth: 70.2% Upside Volume
-
Total Breadth: 68.9% Upside Volume
-
NYSE Advance/Decline: 62.3% Advance
-
Nasdaq Advance/Decline: 62.0% Advance
-
Total Advance/Decline: 62.1% Advance
-
NYSE New Highs/New Lows: 87 / 9
-
Nasdaq New Highs/New Lows: 131 / 52
-
NYSE TRIN: 0.95
-
Nasdaq TRIN: 0.67
Weekly Market 📈
For the week ending Thursday, July 3, 2025
-
NYSE Breadth: 68.9% Upside Volume
-
Nasdaq Breadth: 64.7% Upside Volume
-
Total Breadth: 66.4% Upside Volume
-
NYSE Advance/Decline: 79.9% Advance
-
Nasdaq Advance/Decline: 71.3% Advance
-
Total Advance/Decline: 74.5% Advance
-
NYSE New Highs/New Lows: 267 / 44
-
Nasdaq New Highs/New Lows: 503 / 188
-
NYSE TRIN: 1.70
-
Nasdaq TRIN: 1.32
ES & NQ BTS Levels
ES Levels
The bull/bear line for the ES is at 6272.00. This is the key level that must be reclaimed for bullish momentum to resume. Above this level, buyers will have an edge to push higher.
Currently, ES is trading around 6281.25, indicating early strength above the bull/bear line. If price holds above 6272.00, the next upside objective is 6307.75, our upper range target for today. A sustained break above this target could open the door for further gains toward 6341.25.
If ES reverses back below 6272.00, expect renewed downside pressure targeting 6236.25 and then 6225.75, our lower range target. A decisive move below these levels could extend the decline toward 6202.50.
Support levels are at 6236.25 and 6225.75. Resistance levels are at 6307.75 and 6341.25.
NQ Levels
The bull/bear line for the NQ is at 22,894.20. This is the critical level that needs to be maintained for bullish momentum to stay intact. Trading above this level favors buyers stepping in on pullbacks.
Currently, NQ is trading around 22,928.00, which is slightly above the bull/bear line. As long as the price holds this area, upside targets remain in play. The first resistance is the prior high around 22,972.80. Beyond that, the upper range target for today is 23,058.30. A push through this level opens the path to 23,212.80 as additional resistance.
If NQ loses the bull/bear line, look for initial support near 22,837.80 and then 22,808.50. Below that, the lower range target sits at 22,730.30. A break under this area increases the chance of a decline toward deeper support near 22,575.80.
Calendars
Economic
Today
Important Upcoming / Recent
Earnings
Upcoming
Recent
Trading Room Summaries
Polaris Trading Group Summary – Tuesday, July 8, 2025
How the Day Proceeded
-
This was a Cycle Day 2, with expectations for early MATD (Morning After Trend) rhythms and a “buy the dip” posture unless the 6200 level broke.
-
The Line in the Sand (LIS) was set at 6270, and price largely respected this level through the morning session, with buyers stepping in near the prior close at 6263.
-
David consistently reminded traders to remain patient, take only high-probability (Triple A) setups, and maintain hard stop-losses.
Market Action and Positive Trades
-
In Crude Oil, an Open Range Short achieved Target 2, and a trailing stop was elected to lock in gains. This was one of the few actionable trades in an otherwise choppy environment.
-
The Daily Trade Strategy (DTS) levels were remarkably precise:
-
The upside target at 6290 was missed by just 3 ticks.
-
The downside target at 6255 was exceeded by 4 ticks.
-
David described this as a “Precision Strike,” underscoring the effectiveness of thorough pre-market preparation.
-
Lessons and Themes
-
David emphasized that the market does not adjust to a trader’s desire for activity, and that respecting your strategy’s signals is essential.
-
The price action was described as “Snappy Trappy,” driven by algorithmic swings that can quickly trap impatient traders.
-
David demonstrated restraint, choosing to sit out much of the session rather than forcing trades in difficult conditions.
-
The key lesson was to protect capital and avoid overtrading when market rhythms are unclear or unfavorable.
Highlights Recap
-
Positive trade in Crude Oil with partial profit capture and disciplined exit
-
Nearly exact DTS forecast ranges validating the pre-market plan
-
Reinforcement of patience, discipline, and staying aligned with the dominant force
Discovery Trading Group Room Preview – Wednesday, July 9, 2025
-
Tariffs: President Trump announced a 50% tariff on copper and threatened 200% tariffs on pharmaceuticals. The pause on reciprocal tariffs has been extended to August 1, after which no further extensions will be granted. Copper prices surged 17% on the news.
-
FOMC: The May FOMC Meeting Minutes will be released today at 2:00pm ET, though no major surprises are expected given prior Fed communications.
-
Fed Chair Speculation: Reports suggest Trump may move early to replace Jerome Powell, with Kevin Hassett the leading contender. Other names include Kevin Warsh, Christopher Waller, and Scott Bessent.
-
Used Vehicle Prices: Wholesale used car prices jumped 6.3% YoY, the biggest increase in nearly three years, driven by tariffs on auto imports (currently 25%).
-
Economic Calendar:
-
10:00am ET: Wholesale Inventories
-
10:30am ET: Crude Oil Inventories
-
No notable corporate earnings today.
-
-
Market Technicals:
-
ES Short-term trend: Uptrend channel remains intact, with Dec 6 high (6285.75) acting as resistance.
-
Intermediate trend: Bullish crossover as the 50-day MA (5995) moved above the 200-day MA (5985.25).
-
Key Resistance: 6356/59, 6430/33
-
Key Support: 6085/88, 6056/59, 5643/48
-
Volatility: Steady; 5-day ES average range 50.75 points.
-
No significant overnight whale activity.
-
Affiliate Disclosure: This newsletter may contain affiliate links, which means we may earn a commission if you click through and make a purchase. This comes at no additional cost to you and helps us continue providing valuable content. We only recommend products or services we genuinely believe in. Thank you for your support!
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!
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.
Comments are closed