on April 11, 2025

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Legal Challenge to Tariffs

The New Civil Liberties Alliance filed a lawsuit in Florida federal court.
The suit, on behalf of Florida-based retailer Simplified, aims to block the implementation of the new tariffs and reverse changes to the U.S. tariff schedule.

Fed Rate Expectations Shift

Markets now anticipate 3–4 rate cuts in 2025 amid slowing growth concerns tied to the tariffs.
The Fed remains cautious, with Governor Lisa Cook suggesting tariff-driven inflation could support maintaining a restrictive policy longer.

Focus on Jobs Report (8:30am ET)

The March Jobs Report is the central economic release today.
While important, it’s unlikely to outweigh recession fears stemming from the tariff regime.
No notable corporate earnings on the calendar.

Fed Speaker Schedule Today

Fed Chair Jerome Powell – 11:25am ET
Fed Governor Michael Barr – 12:00pm ET
Fed Governor Christopher Waller – 12:45pm ET

Volatility and Key ES Levels

Volatility has surged, with the ES 5-day average range now at 176.50 points.
Overnight positioning shows a large trader “whale” long bias ahead of the Jobs Report.
ES technicals:
- Support: 5380/75s (intermediate-term channel bottom), 5237/32s
- Resistance: 5707/02s, 6205/00s
Thursday’s selloff respected the channel bottom, but today’s Jobs Report could trigger a breakout in either direction.

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Our View

After the largest rally since 2008 during Wednesday’s Trump-filled headlines, the ES rallied up to 5528.75 on Globex and then sold off down to 5259.50, falling to new lows after the March CPI report showed a significant slowdown in inflation.

The ES traded 5375.50 on the open, climbed to 5389.00, and then sold off after the U.S. raised Chinese tariffs to 145%. I get it—Trump wants a level playing field—but who said he had to rip up the world order in the process?

Either way, the ES and NQ lost almost 50% of Wednesday’s record-setting rally.
I’ve said for years that the U.S. was a dream world: record-breaking highs in the stock market, low energy prices, low interest rates, no inflation, and low food prices. But I’ve got a question for you… do you know how much interest the Fed pays daily, weekly, monthly, or quarterly on the $36.8 trillion U.S. debt?

UNSUSTAINABLE

Based on a $36.8 trillion national debt and a 3.3% average interest rate for 2025:

Daily: $3.33 billion
Weekly: $23.28 billion
Monthly: $101.24 billion
Quarterly: $303.50 billion

I don’t know, and neither does anyone else—not even the White House—how this is going to end. Like him or hate him, Trump is the first president who has tried to tackle government waste. However, the current fiscal policies are unsustainable.

And it’s not just that. ES and NQ have been in a bull market since the credit crisis. Sure, there were pullbacks, but each was followed by hundreds of new all-time highs. It got so easy that 10% to 25% annual returns became the norm.

But now the treasury markets are falling apart. The 30-year bond (ZB=F) hit a high of 120.83123 on April 4th and dropped to a low of 112.65625 in just five sessions. Meanwhile, June gold traded up to another new high overnight to 3,240

The recent weakness in stocks has been tied directly to the treasury weakness as more people lose confidence in Trump’s policies. Eventually, this could force the Fed to start buying Treasury bonds. Leveraged hedge funds are dumping stocks and bonds at a historic pace, triggering the biggest three-day spike in 30-year Treasury yields in over 40 years.

When the PitBull and I talked about treasuries yesterday, we both agreed: something is broken.

In U.S./China news, the tariffs have taken a new twist. The Trump Administration is now leaning toward the possible delisting of Chinese public companies from U.S. exchanges.

Incoming SEC Chair Paul Atkins likely to take up delisting issue when he officially takes office.
Delisting possibility comes amid trade war with China but also growing GOP Congressional appetite to delist Chinese companies.
U.S. law allows delisting if Chinese companies don’t allow inspection of books and ties to the Chinese government.
Lawmakers particularly concerned about so-called “golden shares” that grant the Chinese government control over listed companies.

It’s now 9:26 p.m., and the ES has sold off to 5206.00 on Globex, a drop of -1.75%.

While Trump may win a lot of the tariff battles, China has dug in.

I posted this on Twitter a few days ago—an email from Kun Wang in China:

Trump has gone nuts… Firing at everything… I think he is trying to scare China into coming to the table to talk, but not this time. The prices will shoot to the moon in the U.S. I am more incline to believe that when China take back Taiwan. Something big should happen. Now two countries are whrestling to see who will fall in the end.

Kun Wang – to me Wed, Apr 9, 10:50 AM

This is a stark contrast from his November emails when he said the Chinese love Trump and that China would never invade Taiwan.

Our Lean

This morning, the banks are reporting. JPMorgan, Wells Fargo, and Morgan Stanley are kicking off earnings season, which should be solid. The big question is whether lending standards will be tightened.

Let’s be honest—it’s nearly impossible to keep up with everything that’s going on, and we don’t need to list them all. I don’t think the ES and NQ are heading back up to the highs for a while. Maybe some of the tariff countries will get a deal, but the two big ones—the EU and China—are going to be tough to bring to the bargaining table.

Our lean: I think the ES is going to end up with another oversized trading range. I’ll look at the gaps, but I want to sell the big rips. That doesn’t preclude looking for a mid-morning bounce if the ES falls hard early. So, I’m looking for early weakness, a midmorning bounce, and then will look to sell the rallies.

It’s the Friday of week two options expiration. Resistance is at 5365–5390, 5405, and 5410. On the downside, support comes in at 5320, 5306, 5270–5275, 5260, 5243, 5216, 5210, 5190, 5175, and 5154.

MiM and Daily Recap

Thursday’s session opened under heavy pressure following a steep Globex decline, as ES dropped 126.75 points from the overnight open to settle at 5375.75 by 9:30 AM. The regular session began at 5375.50 after falling from a high of 5405 at 9:24 AM. Sellers quickly stepped back in, driving the market to a fresh low of 5315.75 at 10:12 AM, representing an 89.25-point decline (-1.65%) from the pre-market high.

A modest rally regained traction into the 10:42 AM high of 5373.75, but it failed to clear the earlier peak and reversed again. A sharp decline followed, accelerating into midday, where ES printed a session low of 5146.75 at 12:27 PM, marking a 227-point fall (-4.22%) from the prior swing high. This became the deepest low of the day.

Buyers staged a powerful recovery from there, propelling the ES to 5300.00 at 1:00 PM, a 153.25-point move off the bottom (+2.98%). The next pullback at 1:21 PM bottomed at 5180.25 before another rally kicked in, lifting the market to 5331.50 by 2:03 PM, and then slightly higher to 5351.75 at 2:42 PM. The combined afternoon rally added over 170 points from the 1:21 PM pullback low.

The uptrend lost momentum in the final stretch. ES pulled back to 5255.75 by 2:15 PM, made one more attempt to rally but only managed to reach 5351.75 at 2:42 PM before falling again into the 3:42 PM low of 5234.50. The final hour saw choppy two-way action, closing the regular session at 5299.50—down 76.00 points (-1.41%) from the open and off 190.00 points (-3.46%) from Wednesday’s cash close of 5489.50.

Cleanup session trading was muted, adding just 4.50 points to close at 5303.75, bringing the final full-session loss to 198.75 points (-3.61%).

The overall tone of the day was sharply bearish, driven by persistent selling pressure from the overnight hours into midday. Despite the powerful recovery in the early afternoon, the market couldn’t hold gains into the close, with the failure to reclaim morning highs highlighting a fragile sentiment.

Volume was strong with 2.28 million contracts traded during the regular session and over 2.91 million for the full day, confirming the heightened volatility and conviction behind the moves.

The Market-on-Close (MOC) imbalance revealed a significant $2.96 billion to buy at 3:51 PM, with 75% of the dollar imbalance skewed to the buy side. However, the symbol imbalance remained neutral at 53.1%, failing to reach the ±66% threshold for a strong directional read. While the size of the buy imbalance briefly lifted the market, the lack of broad participation limited its follow-through, and the market faded into the final minutes.

Despite the midday recovery, the inability to hold gains and the fresh lows highlight a market still under distribution, with lower highs forming against a backdrop of heavy volume. Looking ahead, sustained weakness below 5200 could shift sentiment further bearish, while bulls will need a convincing reclaim of 5375+ to stabilize the short-term trend.

How to read the MIM

Technical Edge

Fair Values for April 11, 2025

SP: 33.31
NQ: 135.7
Dow: 206.22

Daily Breadth Data 📊

For Thursday, April 10, 2025

NYSE Breadth: 14% Upside Volume
Nasdaq Breadth: 30% Upside Volume
Total Breadth: 28% Upside Volume
NYSE Advance/Decline: 11% Advance
Nasdaq Advance/Decline: 19% Advance
Total Advance/Decline: 16% Advance
NYSE New Highs/New Lows: 12 / 124
Nasdaq New Highs/New Lows: 34 / 1,494
NYSE TRIN: 0.74
Nasdaq TRIN: 0.57

Weekly Breadth Data 📈

Week Ending Friday, April 4, 2025

NYSE Breadth: 34% Upside Volume
Nasdaq Breadth: 42% Upside Volume
Total Breadth: 39% Upside Volume
NYSE Advance/Decline: 7% Advance
Nasdaq Advance/Decline: 13% Advance
Total Advance/Decline: 11% Advance
NYSE New Highs/New Lows: 106 / 1,073
Nasdaq New Highs/New Lows: 150 / 1,682
NYSE TRIN: 0.14
Nasdaq TRIN: 0.21

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

Founder’s Note:

As mentioned in the morning note, this market is not stable. However, with a 90-day tariff pause in effect, we expect liquidity to somewhat improve and we are likely to see positioning start to return.

Amidst the volatility of the past week, we should also acknowledge that we soon enter the start of earnings season, so we don’t yet know for certain where that returning positioning will manifest itself.

Following yesterday’s gargantuan rally, SPY closed down -4.4%, driven by energy (XLE down -7.77%) and tech (XLK down -5.89%).

Interestingly, equities turned slightly positive mid-day before sharply reversing. Led initially by Utilities and Consumer Staples, it seemed to be a sector rotational theme that we’ll continue to investigate.

Banks report earnings tomorrow (Friday), so we’ll get an initial picture of the Q1 EPS and revenue numbers to see how tariffs impacted the various sectors.

As far as the flows go, equities remained firmly in control with consistent downside pressure beginning at 10:45am ET. While as of lunch, 1B negative delta isn’t near our extreme (-3.6B is our 30 day low), this is a stark contrast to the euphoric rally and epic short covering we experienced yesterday.

As per our note this morning, we highlighted SPX 5300 as strong lower support. That held mostly through the morning but eventually capitulated under the pressure of the Equities basket after S&P 500 index puts began to pick up momentum to the downside.

What to Watch For Next:

Starting tomorrow, all eyes on the street turn towards earnings. While we hold no opinion on earnings for specific names, it’s noteworthy how overall earnings expectations have shifted significantly in the past two weeks:

Pre-tariff news (March 30th):

Forward 4QTR Operating Earnings: $268.81
23x forward multiple

Post-tariff news (April 6th):

Forward 4QTR Operating Earnings: $278
18x forward multiple

Since then, we’ve gone from no tariffs to tariffs, then to paused tariffs with 120% on China exclusively.

As banks prepare earnings for Friday, we could continue to see downside pressure resulting from the precariousness of current economic trade policy. While we know tariffs are largely paused for 90 days, that still leaves much uncertainty beyond that deadline. Looking forward, guidance could be the most important topic for future positioning.

Nothing about this market remains stable, and a market rife with instability means low liquidity may continue to be a danger. While traders may be able to make home runs with one swing, we advocate caution and utilizing spreads to reduce maximum risk exposure.

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, April 10, 2025

Theme of the Day:
Bear Bash & Bull Head-Fakes – A day dominated by heavy selling, failed bull attempts, and high volatility that tested both strategy and mindset.

Pre-Market Overview

No expansion above 5500 overnight in ES; price pulled back into the 5390–5350 lower target zone per the Daily Trade Strategy.
NQ followed suit, pulling into its 18875–18670 support zone.
Bearish tone was established early; bulls would need to reclaim 5440 to regain any control.
Core CPI came in at 2.8% (versus 3% forecast), indicating easing inflation but failing to ignite bullish momentum.

Market Action Highlights

Price stayed below the Open Range, favoring sellers throughout the early session.
CL and NQ shirt trades both hit Target 1 cleanly, offering solid tactical wins early on.
Price action was dominated by sellers with little to no follow-through from attempted buyers.
Key test at 5301.75 central pivot noted; buyers attempted defense at 5345 but failed to hold.
Bullish setups consistently failed, leading David to comment, “Bull Flags become Bullshit Flags.”

Midday Carnage & Circuit Breaker Context

NQ dropped over 6.5%, with traders referencing potential limit-down conditions.
David provided educational links from CME on price limits and circuit breakers.
Despite the selloff, the room maintained a light tone with humor and references to whales and soap bar analogies.
Discussions included potential strategic selling by large players (“killer whales”) driving the market lower.

Afternoon Chop & Algo Control

Post-lunch action saw wide, erratic 5-minute bars with no clear edge.
5345 became a battleground but bulls failed to reclaim it meaningfully.
The session settled into a chop zone with low conviction and high-speed algo-driven swings.
David noted that brokers were the only consistent winners in the afternoon mess.

Late-Day Movement & MOC Surprise

A $3 billion Market on Close buy imbalance appeared late in the day, giving a brief upside spark.
This came after a day of relentless selling and little buyer support, offering a partial resolution into the close.

Key Lessons & Wins

Staying under the Open Range and leaning bearish paid off; the early short trades were the most reliable.
Shirt trades in CL and NQ hit first targets, showing value in disciplined entries.
Recognizing and avoiding failed bullish patterns was critical as setups broke down repeatedly.
The importance of market structure, awareness of key levels, and mental resilience in high-volatility environments was reinforced.

Quote of the Day

“Bull Flags become Bullshit Flags when they do not work.” – PTGDavid

Despite the beating the market handed out, the PTG room stayed composed, focused, and even found some humor through the chaos.

DTG Room Preview – Friday, April 11, 2025

Markets remain volatile as geopolitical tensions intensify, with the U.S.-China trade war escalating sharply. China is taking a hardline stance, signaling readiness for prolonged confrontation. U.S. markets are under pressure — Thursday saw the S&P 500 down 3.5%, Nasdaq off 4.3%, and Dow losing 2.5%. Despite softer March CPI, inflation remains a concern, and today’s PPI data (8:30am ET) is not expected to shift sentiment significantly.

Other market-moving headlines:
- The Pentagon canceled $5.1B in consulting contracts to cut costs, impacting firms like Accenture and Deloitte.
- Corporate earnings to watch include BLK, FAST, MS, BK, and PGR.
- Fed speakers: Musalem (10am ET), Williams (11am ET).
- Economic calendar: PPI (8:30am), Consumer Sentiment & Inflation Expectations (10am).
Technical Outlook:
- ES is in a short-term uptrend inside a broader downtrend. Key resistance levels: 5440/30s and 5617/37s. Support zones: 4910/30s.
- Volatility remains high; the 5-day average ES range is 442.50 points (~8.3%).
- Large trader bias leans bearish heading into this morning’s data.

ES – Week over Week

The bull/bear line for the ES is at 5317.75. This is the key pivot level to watch today. Holding above this level opens the door for a potential upside move, while continued price action below favors bearish continuation.

Currently, ES is trading around 5337.75, slightly above the bull/bear line, which gives bulls a short-term edge. However, the market has been volatile and susceptible to quick reversals, so this level needs to be defended firmly.

If strength continues above 5317.75, the immediate upside resistance to watch is at 5490.50 followed by 5528.75, and the upper range target at 5632.25. Beyond that, 5743.25 marks the upper Bollinger Band and a significant level for extended upside.

On the downside, a break below 5317.75 would shift the tone back toward bearish pressure. Initial support is at 5304.50 (prior close) and 5237.75 (lower Bollinger Band 1). If those levels give way, the next key support comes at 5146.75, followed by the lower range target at 5003.50.

Overall, the tone remains cautious with an upward bias above 5317.75. Bulls must hold this level to sustain any breakout attempt toward the 5500+ zone.

NQ – Week over Week

The bull/bear line for the NQ is at 18,561.50. This level is key for determining directional bias today. Price is currently trading just above this threshold around 18,639.00, indicating a potential attempt to regain bullish momentum after recent weakness. Holding above the bull/bear line opens the door for buyers to press higher intraday.

The lower intraday target is 17,303.25. If NQ fails to maintain strength above 18,561.50 and rolls back under, expect renewed selling pressure toward this lower range area. Beneath that, next support comes in at 17,119.50, which could be tested on an aggressive flush.

To the upside, resistance is stacked. The first test comes in near the 19,021.50 average and then at 19,266.75, which would mark a recovery of the recent failed area. The upper range target for today is 19,819.75, but this would require sustained strength and momentum through 19,500.

The longer-term upper bound resistance remains at 19,972.75. Bulls need to continue holding higher lows above 18,561.50 to build a base for any sustainable upside. If momentum carries through key resistance levels, a shift back toward a bullish tone is possible.

Calendars

Economic Calendar Today

This Week’s High Importance

Earnings:

Full 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!!

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Our View

Over-investment in the top 7 to 10 stocks, the Fed cutting rates while inflation was going up, the U.S. deficit at $36.7 trillion, lower consumer confidence and spending, slower growth, recession fears, earnings growth at risk as tariffs raise costs and erode margins, a softening labor market, geopolitical clashes, and last but not least, President Trump’s unending tariffs. These problems have created an environment of uncertainty and a big jump in the CBOE’s fear gauge, the VIX, which traded all the way up to 30.02. The last time it was this high was August 5, 2024.

The index markets had their steepest declines since 2020 and wiped out $2.7 trillion in market cap. The Dow dropped 1,679 points or 4%, and the tech-heavy Nasdaq—which powered the market higher for years—was down 6%, pulled lower by big declines in $NVDA, $AAPL, and $AMZN. The S&P 500 fell 4.8%, and the other benchmarks suffered their sharpest declines since the early days of the Covid-19 pandemic.

There are thousands of ways to get fooled by the ES and NQ when they start going up, it’s human nature, but the down move sees no bounds. I know there are a lot of really good newsletters out there, some even give “tips.” That is not how this works. First, I try to provide a newsletter that supplies a feel of the markets. Sometimes it’s a few sentences, and other times it’s just a straight look at what’s going on.

Today is the March jobs report, and it could be a pivotal day. Let me explain. In the MrTopStep Trading Rules 101 (https://mrtopstep.com/trading-101/), there are some rules that still work. If you scroll down, you’ll see one called Counter Trend Friday.

Counter-Trend Friday: Over the years, this trade works best on monthly NFP jobs Fridays when the S&P futures gap sharply higher or lower on oversized pre-market Globex volumes of 400k+ ES contracts before the 8:30 am CT open. This is a fade, “the bus is too full” type of trade.

Example: The S&P is down 15 handles at 6:00 am and then down another 20–30 or more handles after the jobs number is released. Now, the S&P is down sharply at the 9:30 am open. With 400k+ minis traded before the open, this tells us that traders have already voted (sold). Depending on the price action, the idea is to buy a sharply lower open or allow the first drop after the gap down. The idea behind this is that with so many minis traded and it being a Friday—and knowing most traders can’t hold the futures over the weekend—they put in buy stops, and the algorithms go right for the buy stops. With all the selling used up pre-open, the ES will start to short cover into the buy stops that lift the offer side of a buy program.

I revised one part of the rule: you buy the lower open or the first drop below the gap down. This would also work in reverse for a big gap up. My gut tells me it’s “FRYday” today, and with the E-mini S&P 500 (ES) falling from its Wednesday high of 5,771 to last night’s early Globex low of 5,407.50—a drop of 364 points in just over 26 hours—the pace is stunning. Yesterday’s breakdown opened the door to 5,300–5,400, yet I didn’t expect it to happen this fast. The decline is accelerating.

Meanwhile, the dollar suffered its sharpest drop since 2023. When asked about the decline, Trump said, “I think it’s going very well; the markets are going to boom.” Oil plunged 6%, and gold fell 1.5% early in the day to $3,087 before rallying $72 from its low, climbing back to $3,140.00.

Our Lean

Like I said, these are great markets for retail traders, but that is a very small segment of the entire marketplace. That said, with the ES and NQ down so much so fast, I think we could bounce. Does it happen after a lower open, or will the ES make an early low and bounce?

Today is the March jobs report, and Goldman Sachs has forecast a 150,000 increase in nonfarm payrolls (NFP) for March 2025. Specifically:

They expect a +150,000 rise in total nonfarm payrolls, slightly above the consensus estimate of +140,000 but below the three-month average of +200,000,
Private payrolls are projected to grow by +160,000, with the unemployment rate (UR) holding steady at 4.1%, consistent with their February outlook where the BLS reported 151,000 jobs added.

Our lean: I’m looking for an early bounce. I could be wrong, but Fridays tend to be counter-trend days. This is not a switch in my opinion, but more of a feeling that the ES and NQ are short-term oversold and due for a bounce that will eventually get sold. If I’m wrong and the ES starts falling again, I have 5390, 5360, and then down to 5320 as the next levels. Everything is moving!

MiM and Daily Recap

The S&P 500 futures (ES) endured a volatile and directional session Thursday, closing markedly lower with consistent selling pressure across the day. The market opened the regular session at 5512.00 and briefly pushed to an early high of 5540.50 at 9:33 AM. This initial strength added 49.25 points from the 9:00 low of 5491.25, but it marked the session’s highest print.

A sharp reversal followed, driving ES down to 5455.00 by 11:06 AM, the morning’s deepest pullback, registering a 1.54% drop from the early high. Buyers briefly regained control through midday, carrying prices to a lower high of 5524.50 at 12:30 PM—an impressive 69.50-point rebound.

That midday strength was again met with selling. A lower high of 5498.00 printed by 1:45 PM, followed by a sharp move down to 5458.00 at 2:30 PM, and a minor lower high at 5483.50 at 2:48 PM. Late-session selling intensified, with the market cascading into a final low of 5415.25 at 4:30 PM, capping a 68.25-point slide from the prior swing high and a full-session loss of 2.33%.

From session to session, ES declined 274.00 points from Wednesday’s cash close of 5695.00 to Thursday’s 5436.00 cash close, a 4.80% drop. The regular session also saw a steep 76.00-point fall from the open to the 4:00 PM close. Volume was robust, with over 1.7 million contracts traded during regular hours and 2.34 million total on the day.

Thursday’s tone leaned decisively bearish, marked by a steady sequence of lower highs and lower lows, and capped by a powerful end-of-day liquidation move. The inability of the midday rally to break above the early high confirmed sellers’ control throughout the day.

The Market-on-Close (MOC) imbalance was notable, with $1.267 billion to buy and a strong dollar imbalance of 75.8% to the buy side. Despite this, the late-session rally failed to materialize. Symbol imbalance reached only 59.8%, below the 66% threshold for a decisive directional read. This suggests that while there was a buy imbalance in dollar terms, it was not broad-based across symbols, and thus didn’t shift the market’s downward momentum.

How to read the MIM