Macro Measure Combo - October 24, 2025

Key Concepts

Market Behavior: Bull market characteristics, VIX reversal, "whistling past October," year-end seasonality.
Economic Factors: Buybacks, FOMC rate decisions, quantitative tightening, housing market influence, credit markets.
Investment Strategies: Hedging with VIX, adding longs, options trading, diversification, risk management, contrarian sentiment.
Technical Analysis: Chart patterns, moving averages (SMAs), breakouts, support/resistance levels, volume, UOA (Unusual Options Activity).
Company-Specific Analysis: Apple, Amazon, Google, Meta, Microsoft, Nvidia, Tesla, Netflix, Berkshire Hathaway, Morgan Stanley, and various smaller cap stocks.
Sector Performance: Tech, Communications, Energy, Financials, Healthcare, Staples, Consumer Discretionary (XLY), Transportation (XTN), Industrials, Utilities (XLU).
Cryptocurrency: Bitcoin performance and technicals.
Semiconductors: SMH performance and technicals.
Commodities: Gold and Silver performance.
Risk Management: Importance of hedges, avoiding complacency, managing position sizing.

Macro Measure and Sector Situation Summary

This analysis, dated Friday, October 24th, 2025, provides a market overview focusing on the current bullish sentiment, potential year-end rally, and specific sector and stock performance. The speaker emphasizes a cautious optimism, highlighting the importance of risk management and chart analysis.

Market Overview and October Performance

The month of October, typically known for significant market developments, has so far been relatively quiet, with a notable threat quickly erased. The market ended the week on a strong note, a behavior characteristic of bull markets. The speaker questions the notion of CTAs (Commodity Trading Advisors) being consistent sellers across all scenarios, finding it illogical. A significant reversal in the VIX, which spiked towards 29 before being quickly managed, suggests that something potentially disruptive was averted. The speaker believes the VIX does not spike to such levels without a reason, indicating a proactive intervention. Despite this, the market has room to grow if a broader spillover is avoided, supported by EPS (Earnings Per Share) season and historical seasonality. The speaker notes that assumptions about AI build-out might be overly optimistic, aligning with the principle of "won't matter until it matters." The market has successfully reclaimed its channel and surpassed previous highs, indicating potential for further upside, though maintaining nimbleness is advised. The end of the week saw a heating up of activity after a generally listless period. The speaker acknowledges carrying VIX hedges, having partially exited them to lock in profits, but prefers to maintain hedges during this period due to historical and current factors. Long positions were added as conditions became conducive, particularly in the last two sessions, with no significant negative news emerging.

Key Factors Supporting the Market

The speaker outlines several factors contributing to a supportive market environment:

Returning Buybacks: Corporate share buyback programs are reportedly returning, which were absent for a period when the market showed little progress.
FOMC Policy: The Federal Open Market Committee (FOMC) is expected to set lower interest rates, potentially driving more money into the market as investors seek higher returns than those offered by lower-yielding fixed-income instruments. This is also anticipated to support the housing market, which is estimated to be tied to roughly 70% of the US economy. Lower rates are also expected to ease pressure on credit markets.
Quantitative Tightening (QT) End: The unofficial or official end of quantitative tightening is anticipated.
Passive Income Month Starts: November and December represent periods where accumulated passive income from American investments is deployed, potentially boosting market liquidity. Many investors are trailing the market's performance and may be looking to enter strong-performing stocks.
EPS Season: Earnings season is expected to yield positive results, with companies engineering beats against analyst expectations. The speaker suggests an "over/under" of 77% for quarterly beats, implying that anything below 70% would be exceptionally dismal given the setup.
Year-End Seasonality: Historical year-end seasonality is expected to be supportive.
Liquidity: Ample liquidity is seen as a significant ongoing support for the market.
Contrarian Sentiment: Sentiment, particularly regarding AI and CTAs, is noted as contrarian and bullish, with many still expressing bearish views.
Underinvested Investors: Investors who have remained underinvested since the spring market low have been given little opportunity to enter, and the recent market reversal has not significantly altered this.

Market Dynamics and Technical Observations

The speaker describes the recent market action as a "squeeze" driven by a "waft algo" on Thursday, characterized by orderly, low-volume upward movement with minimal volatility. This type of behavior often prevails. The upcoming week's news docket, including EPS, FOMC announcements, and month-end closing, is significant. The speaker hopes for a lack of disruptive "Trump-type news" and positive developments regarding China.

October, despite its initial quietness, ended with a strong rally, breaking out to new all-time highs and moving back into its channel. The speaker emphasizes that the clock is running out for bears, with only a few weeks left before normal year-end factors take over, suggesting a continued upward trajectory unless dramatic news emerges. The month of October is characterized as a consolidation period, with megacap stocks (Mag 7) on the launchpad, despite some hesitation from Netflix and Tesla. The rest period in October is expected to translate into upside potential, amplified by positive EPS, FOMC actions, and other supporting factors. Major news developments are seen as the primary risk to this outlook, with the next two weeks being critical for any such emergence.

Specific Stock and Sector Analysis

Megacap Stocks:

Apple: The chart shows a constructive pattern, with the stock on the cusp of breaking out to new highs. Resistance is projected around $275, with option markets also suggesting this level. The stock has shown a strong push off lows, found support at key SMAs, and is poised for potential upside, possibly before or after earnings.
Amazon: Close to taking out its 50-day SMA and potentially running into earnings. The speaker would not rush to sell Amazon given its bounce and upward trajectory, especially with year-end seasonality.
Google: Has broken out to a new all-time high and closed strongly, with EPS potentially driving further gains. The speaker is not inclined to bet against it.
Meta: Is taking out Thursday's high and the 50-day SMA, positioning itself to be above all SMAs. A further push could dramatically flip the charts to a bullish setup after corrective action and base formation. Short-term SMAs are showing signs of curling higher ahead of EPS.
Microsoft: Also has EPS coming up and is challenging all SMAs. With little resistance above, it has potential for further upside.
Nvidia: Has rested and shows a double-bottom pattern. The stock has a bullish look and could re-emerge to help the market into earnings season.
Tesla: Despite a strong day after earnings, it has been sideways for about a month and a half. With long-term uptrends intact and intermediate-term trends up, short-term trends are flat, suggesting a potential resumption of its upward move, assuming a news-neutral environment. The speaker notes potential overlooked facets like energy, but the EV political situation is a factor.
Netflix: Is identified as the "millstone" of the megacaps, cratering below the 200-day SMA, and is the primary reason the megacap package does not look great.

Other Large Cap Names:

Morgan Stanley: Looks ready to challenge its 20-day SMA, which would place it above virtually all SMAs after corrective action and with declining rates.
Berkshire Hathaway: Is flatlining but could join the rally after resting, with no overbought conditions. A move to the top of its range is possible.

SPDR S&P 500 ETF (SPY):

The SPY has broken back above a former support line of its rising channel, which is a positive sign. However, the breakout is described as "cheesy" and lacking the typical intraday action. The speaker is cautious about the sustainability of this gap-up, noting that a slight pullback to close the gap or retest former highs near 673 is possible. Holding above current levels is crucial for increased confidence. The market has repeatedly made incremental new highs without impressive sustained moves, a pattern that has continued for months. The recent rally, driven by the "WAT algo," is seen as a response to news that was anticipated. While a victory for bulls is not yet declared, the trading activity is expected to improve. The speaker notes that while some individual trades have been extraordinary (BYND, CLV), the "meat and potatoes" trades have been less impressive, with many requiring holding positions for extended periods to realize gains rather than benefiting from consistent intraday momentum. Market breadth has improved significantly in the last two sessions, but the candles lack "moxy," and the behavior is described as "inauthentic" yet effective.

SPY Projections:

The speaker projects that if the SPY holds current levels and stays in its channel, it could reach the mid-channel line around 694. Further upside to the seven-teens is possible with strong market pushes. The projection for the ultimate high is around 16, based on the current trajectory and weak follow-through. The speaker anticipates potential excitement around the FOMC and EPS, but also notes the possibility of unexpected news. The pattern of a weak week followed by a strong Thursday/Friday rally and a Monday follow-through has been consistent for months.

Sector Performance:

Technology & Communications: Ignited by the end of the week, with Google and Meta on the launchpad.
Energy: Performed well but cooled off towards the end of the week.
Financials: Looking to re-establish themselves after a period of decline.
Healthcare/Pharmaceuticals: Some names have seen buying interest, including meme stocks and legitimate companies like Amgen.
Consumer Discretionary (XLY): Had a weak week until Thursday's reversal, now back towards recent highs.
Transportation (XTN): Disappointing again with another false breakout.
Materials: Performance was not as strong as expected.
Industrials: Poor finish to the week.
Utilities (XLU): Heating up towards the end of the week, which could be a positive sign.

Other Assets:

Bitcoin: Has pulled back significantly, clearing out holders against lows. It touched the 200-day SMA and is now holding above the 150-day SMA. Consolidation is occurring, and a move above the 20-day SMA could flip the charts more bullishly.
Semiconductors (SMH): Showed resilience, saving itself from the 20-day SMA on Wednesday and then gapping up to a new all-time high on Thursday. While a pullback is possible, the trends are strong with sloped and stacked SMAs. An ideal scenario involves a pullback to frustrate breakout buyers before a sustained move higher.

Risk Management and Hedging

The speaker reiterates the importance of hedging, particularly with VIX. Despite partially exiting VIX contracts, the speaker plans to add more VIX and longs as a hedge, holding them until mid-November. The VIX is viewed as a hedge, not a primary profit-generating vehicle. The speaker expresses a desire to add more VIX if it drops further, doubling down on size if it reaches near 14, not out of bearishness, but to maintain hedges for a longer duration.

Individual Stock Ideas and Radar

The speaker shares several individual stock ideas that look interesting, emphasizing that these are not "table pounders" but rather names to watch:

ENPH: Looks interesting, corrected, and had strong performance.
NBIS: Potentially crossing short-term SMAs, with a bull market scenario in play.
Snow: Acting well, making new highs, with potential cup-and-handle patterns.
DDOG: Close to challenging all SMAs, with uptrending averages and potential for a cup-and-handle.
Palantir: Consolidating and looks interesting.
HOOD: Similar to other names, rejoining the rally after pulling back and finding support.
CoreWeave: Not as technically advanced as others but has potential if the market continues to rally.
Amgen: Disappointing performance, only a small pop followed by a pullback.
A specific stock with unusual out-of-the-money call buying: The speaker is long this stock in a spread form but expresses discomfort due to limited chart history and a "head scratcher" trade.
Another stock with paper and potential to launch a new leg.
Wheels Up: A lower-priced name showing signs of lifting.
A stock with call buying and an entry bot set up.

Conclusion and Outlook

The speaker concludes that the jury is still out on the market's ultimate direction, cautioning against complacency despite the new all-time high. The VIX being "smoked" is seen as a sign of complacency. The speaker plans to maintain hedges until mid-November, feeling more comfortable after that window. The speaker believes something significant was averted in October, as indicated by the VIX spike, but the exact nature remains unknown. The speaker is spreading exposure across various names with lower individual exposure levels due to time constraints. The overall message is to remain cautious, stay on guard, and continue to follow the charts and market trends until they break down. The speaker hopes the shared information is useful and advises viewers to stay careful and keep their heads on a swivel.