SP500 LDN TRADING UPDATE 31/7/25

WEEKLY & DAILY LEVELS

***QUOTING ES1! CASH US500 EQUIVALENT LEVELS SUBTRACT ~25 POINTS***

WEEKLY BULL BEAR ZONE 6380/90

WEEKLY RANGE RES 6515 SUP 6335

DAILY BULL BEAR ZONE 6410/00

DAILY RANGE RES 6484 SUP 6367

2 SIGMA RES 6542 SUP 6309

GAP LEVELS 6396/6147/6077/6018/5843/5741/5710 

VIX DAILY BULL BEAR ZONE 17.75

DAILY MARKET CONDITION -ONE TIME FRAMING UP 6418

One-Time Framing Up (OTFU): This represents a market trend where each successive bar forms a higher low, signaling a strong and consistent upward movement.

TRADES & TARGETS

SHORT ON TEST/REJECT DAILY RANGE RES TARGET DAILY BULL BEAR ZONE

LONG ON TEST/REJECT DAILY BULL BEAR ZONE TARGET DAILY RANGE RES

(I FADE TESTS OF 2 SIGMA LEVELS ESPECIALLY INTO THE FINAL HOUR OF THE NY CASH SESSION AS 90% OF THE TIME WHEN TESTED THE MARKET WILL CLOSE AT OR BELOW THESE LEVELS)

GOLDMAN SACHS TRADING DESK VIEWS

 U.S. EQUITIES UPDATE: WHIPSAW

FICC and Equities | 30 July 2025 |

Market Performance:

- S&P 500: -12bps, closing at 6,362

- NASDAQ 100 (NDX): -16bps, closing at 23,345

- Russell 2000 (R2K): -54bps, closing at 2,241

- Dow Jones: -38bps, closing at 44,461

Trading Volume:

17.9 billion shares traded across all U.S. equity exchanges, exceeding the YTD daily average of 16.8 billion shares.

Volatility Index (VIX): -313bps, ending at 15.48

Crude Oil: +114bps, priced at $70

U.S. 10-Year Yield: +4bps, at 4.37%

Gold: -84bps, priced at $3,352

Dollar Index (DXY): +108bps, at 98.95

Bitcoin: -9bps, priced at $117,044

Key Drivers:

The Federal Reserve held rates steady as expected, with Waller and Bowman dissenting. Powell’s commentary during the press conference caused stocks to slide after stating, “We have made no decisions about September. We don't do that in advance.” He also pushed back against political pressure to cut rates, emphasizing, “We don’t consider the fiscal needs of the federal government...it would not be good for our credibility, nor for the credibility of U.S. fiscal policy.”

Copper markets faced selling pressure following Trump’s announcement of universal 50% tariffs on semi-finished copper products and copper-intensive derivatives.

Despite broader market volatility, big tech outperformed, buoyed by strong quarterly reports from META and MSFT, both trading +7% after hours.

Earnings Highlights:

- Microsoft (MSFT): Azure growth of +39% constant currency (cc) vs. expectations of +35%. The setup was skewed long, and the high bar was met.

- Meta (META): Revenue beat expectations significantly ($47.5bn vs. consensus $4.83bn). Operating income also exceeded forecasts ($20.4bn vs. consensus $17.24bn). FY Capex and Opex guidance were raised, though less aggressively than anticipated.

Floor Activity:

Overall activity levels were moderate, rated a 6 on a 1-10 scale. The floor finished +3.4% to buy vs. a 20-day average of +50bps. Long-only (LO) and hedge funds (HFs) were flat, with overlapping demand in communication services and offsetting flows in industrials. LOs screened as net buyers, while HFs were net sellers within the sector.

Derivatives Update:

Volatility dipped slightly across the curve, with skew bid in longer-dated tenors. Despite a wider intraday trading band, the S&P 500 failed to realize the 50bp Fed straddle for the day.

- The desk favors short-dated IWM upside for a potential squeeze, given better vol carry in Russell vs. S&P and NDX.

- Longer-dated S&P 6-month vol is seen as the best long-term play.

- Implied move for the remainder of the week is 77bps, factoring in PCE and NFP data