Prior Trading Day Summary:
On Mon May 12 2025 news of a 90 day pause on tariffs while China and USA negotiates a trade deal was all it took for investors to rush into equities, despite most stocks having recovered most of what they lost in late March and early April when markets plunged on tariff worries. The rush of investors of all kinds into equities has pushed the index to overbought readings and was overdone on Monday.
The S&P closed up 184 points to close at 5,844 for a gain of 3.26%. Volume shot to 6 billion shares, the highest volume since April 10 when markets were rebounding. With Monday’s rally, the S&P is now up more than 20% from the early April tariff worries lows.
The NASDAQ moved even higher, climbing 779 points to 18,708 for a 4.35% gain. Volume was 11 billion shares traded with 82% of all volume being traded higher. This is the highest one day volume since Apr 29 when 13.4 billion shares were traded.
Volumes were huge on many equities and gains were large. Semiconductors roared back to life with the SMH ETF reflecting this as it rose 6.27% intraday. NVIDIA Stock (NVDA) was up 5.4% along with Advanced Micro Devices Stock (AMD) which rose 5.13%. Other stocks of note included Carnival Corp Stock (CCL) which soared 9.6%. In financials, Goldman Sachs Stock (GS) rose 4.27% leading that sector higher. Delta Air Lines Stock (DAL) rose 5.79%, AIRBNB Stock (ABNB) rose 5.64% and Expedia Stock (EXPE) which last week saw large declines, rose over $10 for a 6.76% gain. These are just a handful of the hundreds of stocks that rose dramatically on Monday. Many analysts were surprised at the strength of the rally as they pointed out nothing really had changed for the economic outlook including interest rates and unemployment. Investors though were in a buying mood and nothing analysts could say deterred the buying frenzy.
Let’s review the technical indicators from the close on Mon May 12 2025 to see what we should expect for Tue May 13 2025 following Monday’s huge advances.
Stock Market Outlook: SPX Closing Chart For Mon May 12 2025
The index closed above all major moving averages and above the Upper Bollinger Band. This signals overbought but also bullish.
The closing candlestick is bullish but also signals morning dips are likely.
The 21 day moving average is rising and closed at 5502 which is bullish. The 21 day moving average fell below the 50 day on Friday Mar 7. It fell below the 100 day on Thursday Mar 13 for a second down signal and on Friday Mar 28 it fell below the 200 day for a third down signal.
The 50 day moving average is falling and closed at 5549 which is bearish. The 50 day moving average fell below the 100 day on Tue April 15 which issued a 4th down signal on the SPX. The 50 day on Friday May 2 fell below the 200 day for a 5th down signal.
The 100 day moving average is rising and closed at 5677 which is bullish.
The 200 day moving average is rising and closed at 5640 which is bullish.
The Lower Bollinger Band is turning sideways which is bearish. The Upper Bollinger Band is rising which is bullish.
For Tue May 13 2025 the SPX chart is more bullish than bearish.
SPX Stock Market Outlook review of Mon May 12 2025
Stock Market Outlook: Technical Indicators Review
Momentum: Momentum is rising and positive.
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MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal on Tue Apr 22 2025. On Mon May 12 2025 the up signal gained strength.
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Ultimate Oscillator: The Ultimate Oscillator is rising sharply and positive.
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Slow Stochastic: The Slow Stochastic has an up signal at the close and is overbought.
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Relative Strength Index: The RSI signal is rising and nearing overbought readings.
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| Rate of Change: The rate of change signal is rising, signaling a higher close is expected on Tuesday. Settings: Rate Of Change is set for a 21 period. This indicator looks back 21 days and compares price action from the past to the present. With the Rate Of Change, prices are rising when signals are positive. Conversely, prices are falling when signals are negative. As an advance rises, the Rate Of Change signal should also rise higher, otherwise the rally is suspect. A decline should see the Rate Of Change fall into negative signals. The more negative the signals the stronger the decline. |
Stock Market Outlook: Support and Resistance Levels |
| 5750 is resistance |
| 5700 is resistance |
| 5650 is resistance |
| 5630 is resistance |
| 5600 is resistance |
| 5550 is support |
| 5500 is support |
| 5475 is support |
| 5450 is support |
| 5400 is support |
| 5350 is support |
| 5300 is support |
| 5230 is support |
| 5000 is support |
| 4770 is support |
| 4680 is support |
| 4500 is support |
| 4365 is support |
| 4150 is support |
| 4000 is support |
Stock Market Outlook for Tue May 13 2025
To start the day on Tuesday there are two more support levels in place following Monday’s giant rally. The 5500 and 5550 levels in the SPX are back as support.
Markets are overbought and investor enthusiasm is “ahead of itself”. The morning open will see some selling and indeed it could see deeper selling than anticipated but the outlook is bullish and stocks are expected to close either slightly lower or flat to higher.
On Tuesday before the open we get the latest CPI (Consumer Price Index) numbers which are expected to rise slightly as you can see in the Potential Economic and Political Market Moving Events section below.
Potential Economic and Political Market Moving Events
Monday:
2:00 Monthly federal budget for April came in slightly higher than estimated at $258 billion
Tuesday:
6:00 NFIB optimism index is expected to slip slightly to 95.0
8:30 Consumer price index is expected to rise to 0.2% from -0.1%
8:30 Consumer Price Index (CPI) year-over-year are estimated unchanged at 2.4%
8:30 Core CPI is expected to rise slightly to 0.3% from 0.1% prior
8:30 Core CPI year-over-year is estimated to rise to 2.9% from 2.8% prior