Sunday Post - Recap & Week Ahead 8/10/2025
Stock Market Analysis & Insights, Charts and Levels
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The US stock market rallied this week, driven by gains in mega-cap technology and semiconductor stocks, even as underlying breadth remained weak with more decliners than advancers across major exchanges. Narrow leadership fueled new record highs for the Nasdaq, while cyclicals posted modest gains and defensive sectors lagged. Volatility fell sharply, and Treasury yields edged higher as safe-haven demand eased.
S&P 500 rose 2.4% to close at 6,389
Nasdaq jumped 3.9% to end at 21,450
Dow Jones gained 1.3% to finish at 44,176
Russell 2000 advanced 2.4%, closing at 2,218
Sector performance was mixed: Retail led gains, up 3.75%, followed by Consumer Discretionary (+3.56%), Technology (+3.44%), and Semiconductors (+2.72%). Financials (+0.88%) and Industrials (+0.73%) were modestly higher, while Health Care (-0.74%) and Energy (-0.77%) ended in the red. Market breadth was weak: on the NYSE, decliners slightly outpaced advancers by a 1.01-to-1 ratio; on the Nasdaq, decliners led by a 1.35-to-1 margin. This reflects a rally concentrated in a handful of large-cap names despite broader participation remaining muted. The VIX fell 25.66% to 15.15, its lowest in nearly two months. Investor sentiment showed mixed signals: AAII bullish sentiment pulled back to about 34.9% (down from the prior release), while the CNN Fear & Greed composite moved back into the Greed range (roughly 59 on the index).
Bond yields climbed as investors rotated back into equities: the 10-Year yield rose to 4.285%, while the 30-Year finished near 4.85%. Gold gained over 1% to close at $3,398/oz, while WTI crude oil dropped 5.81% to approximately $63.34/barrel on softening demand expectations. Bitcoin rose 2.9% for the week to close near $116,675. US-listed spot Bitcoin ETFs recorded net inflows of $404 million on Friday—led by BlackRock’s IBIT (+$360 million) and Fidelity’s FBTC (+$30 million), with smaller gains across other issuers.
Overall, it was a headline-strong but internally narrow week: major indices rallied, volatility eased, yields moved higher, gold stayed firm, oil weakened, and Bitcoin saw renewed buying interest. With inflation data and the geopolitical events ahead, the market’s leadership trend will remain under close watch.
While the S&P 500 sits within 1% of its all-time high, the underlying market tells a different story—the median stock is still 12% below its 52-week peak. This highlights the market’s narrow leadership, where gains are concentrated in a handful of mega-cap names while the majority of stocks lag behind. Such divergence can mask underlying weakness, leaving the index vulnerable if leadership falters. See chart below.
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Moreover, the cost of downside protection in the S&P 500 has surged to its highest level since May 2023, with the 60-day 90/110 skew ratio reaching 2.2. This means hedging against a 10% drop in the SPY is now significantly more expensive, reflecting heightened demand for out-of-the-money puts. Large institutional players—those with deeper access to data, research, and market intelligence—are paying up for protection, signaling a growing concern over potential turbulence ahead. While this doesn’t guarantee a near-term sell-off, historically such extremes in skew have often coincided with elevated market stress or volatility in the weeks that follow. In other words, when professional money starts aggressively hedging, it’s worth paying attention. See chart below.
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As shown in the daily ES chart below, the key 6284 support level held early in the week, prompting a rebound. The ES market is now approaching its all-time high and the overhead resistance, which aligns with the prior upward channel originating from the October 2023 low (blue dashed lines). On the last test, this resistance—currently around the 6,500 area—was rejected, leading to a breakdown of the broader upward channel that began from the April lows. The coming week will be critical to see whether the rally can break through this overhead resistance and push into new record territory.
As usual, I will do a brief recap of this week´s market action, followed by an analysis of the general markets and the various sectors, and conclude with an outlook for the upcoming week.
Recap:
The bottom of the 3-Day Balance was defended early in the week, fulfilling a key requirement for the Bullish case outlined in the previous Sunday Post. From there, the ES rallied to the top of the Balance, where—as expected—it was initially rejected. A highlighted resistance-turned-support zone then held during the subsequent pullback, allowing the market to recover and retest the Balance top. This resistance zone was ultimately broken during the OVN session on Thursday, triggering a move to additional upside targets, with the market topping out near the second-to-last target for the week. These developments closely aligned with the Bullish roadmap laid out in the last Sunday Post. However, during Thursday’s regular session, the market reversed, falling back inside the Balance area before managing to close right at the Balance top. Notably, it also reclaimed and closed above the daily 20-MA. On Friday, the rally resumed, carrying the market back toward the second-to-last weekly target.
General Markets and Sectors:
Check out the updated Charts Page which goes with this section.
The S&P 500 rebounded, breaking above the 6297 resistance (now support) and advancing toward the all-time record high. Resistance is now seen at 6427, with additional overhead resistance from the upward channel originating at the March 2020 low, currently around the 6480 area.
The NDX/Nasdaq rebounded after the defense of the 22642 support and made another all-time record high. This area coincides with the now broken 23478 resistance level and the upward channel resistance from the December 2022/January 2023 lows (dashed black lines). Is there going to be another rejection?
The Dow Jones defended the 43276 support/daily 50 MA and rebounded to the 44359 resistance. It is now rangebound since late June between the 45014 resistance, which is near the all-time highs and the 43276 support.
Small Caps (IWM) defended the 212 support which is near the daily 50 MA and 200 MA, then bounced back higher. It is now rangebound since late June between the 227-resistance level and the 212 support.
The FFTY index consolidated around the upward channel resistance from the October 2023 low.
The $VIX sold off sharply moving to the recent lows. It is now back to being technically weaker which reflects a generally Bullish environment for equities.
Crude Oil sold off sharply breaking below both the $67 support (now resistance) and the daily 50 MA. It is currently near the June lows.
Gold rebounded from the 3288 support, moving back above the daily 50 MA and toward the 3424 resistance. It has been in consolidation mode since April and remains in the upward channel from the February 2024 low.
The US 10-Year rebounded from the 4.21% support. Resistances are at the 4.40% level and the daily 50 MA/200 MA. It remains in the downward channel from the October 2023 high.
The USDJPY consolidated above the daily 50 MA, which is support. Resistance is at 148.50.
Bitcoin bounced off the daily 50 MA and broke above the 116025 resistance (now support). It is rangebound and remains in the upward channel from the October 2023 low.
Semis, SOX is rangebound since late June and remains in the upward channel from the October 2022 low.
Consumer Disc, XLY rebounded from the daily 200 MA (also 50 MA) and moved toward the upward channel resistance from the December 2022 low. It is rangebound since late June.
The Retail sector, XRT rebounded from the daily 200 MA and moved back toward the upward channel resistance from the September 2022 low. It is also rangebound since late June.
The Tech sector, XLK rebounded toward the all-time record high, which is right above the upward channel resistance from the October 2022 low.
Transports, IYT rebounded and reclaimed both the daily 50 MA and 200 MA. It remains in the upward channel from the October 2023 low.
Financials sector, XLF consolidated around the daily 50 MA area, which aligns with a prior long-term resistance trendline. It remains in the upward channel from the October 2023 low.
The Materials sector, XLB consolidated around both the daily 50 MA and 200 MA. It remains within a long-term upward channel.
Industrials, XLI consolidated above the daily 50 MA. It remains in the upward channel from the March 2020 lows.
The Health sector, XLV has been in a wide-ranged consolidation since April and remains in the downward channel from the September 2024 high.
Consumer Staples, XLP bounced off the upward channel support from the October 2023 low and reclaimed the daily 200 MA/50 MA. It has been rangebound since mid-April.
Utilities, XLU made another all-time record high and then sold off toward a prior long-term resistance trendline (now support). It remains in the upward channel from the October 2023 low.
The Energy sector, XLE continues to fluctuate around the daily 200 MA and the 50 MA. It has been rangebound for over two years (shaded area).
YEAR-TO-DATE RETURN:
IXIC Nasdaq +11.5%
SPX S&P 500 +9.5%
DJIA Dow Jones +4.8%
XLU U.S. Utilities Sector: +15.5%
XLI U.S. Industrials Sector: +15.2%
XLK U.S. Technology Sector: +14.7%
SOX Semiconductor Index: +13.0%
XLF U.S. Financial Sector: +8.0%
XLP U.S. Consumer Staples Sector: +6.2%
XLB U.S. Materials Sector: +6.0%
XRT U.S. Retail Industry: +2.0%
IYT Dow Jones Transports: +1.3%
XLE U.S. Energy Sector: +0.7%
XLY U.S. Consumer Disc Sector: +0.2%
XLV U.S. Health Care Sector: -4.6%
Week of 8/11/2025:
Click link for complete Economic Calendar.
United States - CPI and PPI, retail sales, industrial production, and the preliminary reading of the University of Michigan’s consumer sentiment.
United Kingdom - GDP, labor market, industrial production, and trade figures.
China - industrial production, retail sales, and new yuan loans.
Eurozone - GDP.
Germany - ZEW economic sentiment.
Japan - preliminary Q2 GDP.
Inflation data - India and Brazil.
Reserve Bank of Australia (RBA) - will announce its monetary policy decision.