Weekend Report for Monday, May 5, 2025
Bottom Line:
From last weekend’s Update:
The SPX, NDX, RUT, NYA and RSP have all closed above their respective April 9 highs. This is a bullish signal. The DOW is lagging and has not closed above its April 9 high, but under a bullish scenario it will, soon.
A strong case can be made for a sustained bull trend in progress that will carry the indices (some, at least) to new highs. If a bull trend has resumed, ranges will decrease, retracements will be very shallow and VIX will continue to drop. Also, NYSE net breadth readings will establish much higher lows than those we have seen recently.
A close below the 4/21 lows by all four of the primary US indices negates the bullish scenario.
Last week’s trade added to the potentially bullish scenario and increases the probabilities that one or more of the primary US trading indices may trade to a new ATH. The probability of that increased because of last week’s trade.
However, short-term the indices are getting quite stretched to the upside and due for some amount of retracement.
PDF: Weekend Report_2025_05_04
VIDEO: https://youtu.be/y4ZPk8WGZKg
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SPX
Upper KRA: 5749-5793
Lower KRAs: 5357 (and see the 30m chart below)
The SPX is just below its 200-day MA and an important upper pivot high. It is up almost 18% from the recent low. Regardless of how bullish the market may be right now, or how high it may ultimately go, the SPX is extended and the current rate of change will not continue.
SPX 30m
Short-term downside KRAs are highlighted on the chart below. On the next retracement (which is due) watch for a contraction in breadth to -1500 or lower. In bull trends this typically coincides with pivot lows.
RSP
Upper KRA: 175-177
Lower KRA: 165-163
NDX:
Upper KRA: 20292
Lower KRA: 18685-18412
The NDX has reached a KRA comprised of the 200-day MA and the 3/25 pivot high.
DOW:
Upper KRA: 42530-42827
Lower KRA: 39394-39196
RUT
Upper KRA: 2027-2048
Lower KRA: 1915-1890
New York Composite
Upper KRA: 19563
Lower KRA: 18862-18740
The NYA is less than 5% from a new ATH.
VIX will soon drop to 20 or below if we have resumed a bull trend.
NYSE Data – Internals
This perspective reflects the potential for a significant top to occur very soon. However…
From last week and no change:
….if we are in a bull trend this is what is likely to occur.
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US Dollar
The US Dollar is testing its breakdown level.
US 10-yr Notes
The 110’12 level is critical; Notes have been unable to sustain a move below it.
Gold
Gold has had an incredible move. Some retracement is not a surprise. See the Special Report I posted about a week ago.
Crude
Crude is testing its recent spike low.
Bitcoin
Bitcoin has re-established its uptrend. 74563 is a critical downside level.
