SP500 LDN TRADING UPDATE 8/7/25
WEEKLY & DAILY LEVELS
***QUOTING ES1! CASH US500 EQUIVALENT LEVELS SUBTRACT ~50 POINTS***
WEEKLY BULL BEAR ZONE 6220/10
WEEKLY RANGE RES 6424 SUP 6224
DAILY BULL BEAR ZONE 6240/30
DAILY RANGE RES 6322 SUP 6204
2 SIGMA RES 6381 SUP 6145
GAP LEVELS 6324/6274/6147/6077/6018/5843/5741/5710
VIX BULL JULY CONTRACT BEAR ZONE 21.35 DAILY BULL BEAR ZONE 19
DAILY MARKET CONDITION - BALANCE - 6333/6238
Balance: This refers to a market condition where prices move within a defined range, reflecting uncertainty as participants await further market-generated information. Our approach to balance includes favoring fade trades at the range extremes (highs/lows) while preparing for potential breakout scenarios if the balance shifts.
TRADES & TARGETS
LONG ON TEST/REJECT DAILY BULL BEAR ZONE TARGET DAILY RANGE RES
SHORT ON TEST REJECT DAILY RANGE RES/GAP 6324 TARGET DAILY BULL BEAR ZONE
(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: TRADE TALKS IN FOCUS
FICC and Equities | July 7, 2025 | 9:20 PM UTC
Market Performance:
- S&P 500: -79bps, closing at 6,229
- Nasdaq 100 (NDX): -79bps, closing at 22,685
- Russell 2000 (R2K): -149bps, closing at 2,229
- Dow Jones: -94bps, closing at 44,406
Volume: 16.6 billion shares traded across all U.S. equity exchanges, slightly below the year-to-date daily average of 16.8 billion shares.
Key Indicators:
- VIX: +177bps, closing at 17.79
- Crude Oil: +142bps, settling at $67.95
- U.S. 10-Year Yield: +3bps, closing at 4.38%
- Gold: +13bps, closing at $3,347
- DXY: +38bps, ending at 97.55
- Bitcoin: Unchanged at $107,971
Market Sentiment:
Market participants returned from the long weekend with trade discussions dominating headlines. Tariff letters, including a 25% tariff for South Korea and Japan, were deemed "too high," sparking concerns. High beta stocks (GSP1BETA) sold off (-125bps), while quality and large-cap names performed well (+75bps). Hedge Fund VIP vs. Most Short closed up +161bps, marking the first positive close in a week.
Negotiations remain in focus as the July 9 deadline was extended to August 1, allowing more time for discussions.
Notable Movement:
- Tesla (TSLA) fell -7% following Elon Musk’s announcement of forming a new "America Party" and a downgrade citing concerns over Musk’s distraction and a tax bill reducing demand for Tesla’s emissions standards credit.
Floor Activity:
- Activity levels ranked 4/10, reflecting subdued engagement.
- Floor performance: -141bps for sale vs. a 30-day average of -54bps.
- LOs screened as net sellers (-$1 billion) across all sectors.
- Hedge funds finished flat, with supply in discretionary and financials offset by demand in healthcare and staples.
- Largest MOC buy imbalance since May 29, 2025, with the fifth consecutive >$2 billion MOC buy imbalance, signaling strong retail and systematic bids.
Upcoming Events:
Delta Air Lines (DAL) reports earnings Thursday morning before market open, with an implied 7% move and positioning rated 6/10. Analysts suggest potential downside pressure before capacity cuts drive higher RASM and EPS revisions.
PRIME Highlights:
1. U.S. equities were net bought, driven primarily by long buys.
2. Macro products saw net buying (short covers + long buys), while single stocks ended flat as short sales offset long buys.
3. Gross leverage decreased by 1.6 points to 294% (97th percentile 1-year, 99th percentile 5-year).
4. Net leverage dipped by 0.1 points to 78.9% (84th percentile 1-year, 69th percentile 5-year).
DERIVATIVES:
Post-holiday trading saw markets dip amid tariff-related headlines. Volatility spiked, with skew steepening as investors positioned for a busy July of tariff negotiations and earnings reports. Short-dated upside buying was observed, alongside some downside selling to capitalize on skew spikes. SPX short-dated upside remains attractive, supported by strong micro-seasonals and sustained systematic and retail bids.
- SPX 30-Jul 6,500 calls traded at an 11.5 vol, reflecting historical strength in July performance.
- Macro calendar for the week remains relatively quiet, with the straddle for the remainder of the week closing at ~1.22%.
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!