Daily Brief - Friday, 8/15/25
Market Shrugs Off Hot PPI, Settles Into Wait-and-See Mode Before Jackson Hole
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News Docket
Friday - 8/15/25
8:30am EST - US Retail Sales MoM (Expected: 0.5%)
9:15am EST - US Industrial Production MoM (Expected: 0%)
10:00am EST - University Michigan Sentiment Prelim (Expected: 62)
Prior Session Analysis - Thursday, 8/14/25
Session Stats
Open: 23,857.75
High: 24,007.75
Low: 23,841.25
Close: 23,922.00
Settlement: 23,930.50
Range: 166.50 points / 666 ticks
Volume: 493,218
Open Interest Change: +3,111 (NQU5)
Value Area (Market Profile)
Value Area High (VAH): 23,960.00
Point of Control (POC): 23,925.00
Value Area Low (VAL): 23,900.00
Prior Session Breakdown - Market Profile and NY Session
Thursday delivered another reminder that this market just refuses to roll over, no matter what the data throws at it. PPI came in with a big surprise—much larger inflation numbers than expected—and the initial reaction was exactly what you'd expect: a selloff down to 23,820. But here's where this market continues to impress me: price recovered quickly and managed to open regular trading hours with only a 30-point gap to the downside.
Off the open, price continued its upward auction, finding resistance right at that psychological 24,000 level before reversing. From there, the market settled into what can only be described as textbook balanced behavior, rotating between roughly 23,960 and 23,870 for the remainder of the session. The session developed into a normal day with a "D"-shaped profile and no range extensions—classic two-way trade.
After the PPI numbers, I honestly thought we might see another day of selling similar to Wednesday's profit-taking. That didn't happen. Instead, price largely stayed in the same range as Wednesday's session, and we've now spent the better part of two sessions just balancing after coming down from those all-time highs.
This consolidation deserves close attention because it could move strongly in either direction at any point. Based on my experience, this type of action usually indicates the market is waiting for more information. The healthy increase in open interest of over 3,000 contracts suggests institutions are comfortable adding exposure during this consolidation rather than reducing it.
The value area showed interesting behavior, with the VAH holding steady at 23,960 (same as Wednesday) while the VAL widened down to 23,900. This indicates increased two-way trade facilitation with both timeframes actively participating. The POC positioned at 23,925, pretty much in the middle of the value area, confirms good agreement on fair value within this defined range.
The excess on both ends of the profile reinforces the balanced nature of the session, showing the market found its boundaries and respected them throughout the day.
Volume & Participation
Total Volume: 493,218 – similar to recent sessions, showing consistent engagement
Open Interest: +3,111 contracts (NQU5) – healthy increase indicating new business coming in during consolidation
Price Range: 166.50 points / 666 ticks – very compressed range reflecting the strong agreement on fair value by both sides
The combination of steady volume with increasing open interest during a consolidation phase is encouraging. It suggests that rather than participants getting nervous and reducing exposure, they're using the stability to add positions. No indications of fear in this market, at least at the moment.
Final Thoughts
Thursday's action reinforced the theme that this market's underlying strength continues to surprise. Even with hot PPI data that should theoretically be bearish for risk assets, we got balanced consolidation rather than sustained selling. The market seems to be in a "waiting for more information" mode, which makes sense given next week's Jackson Hole Symposium and the inflation data we've seen this week. The question is whether this consolidation leads to another leg higher or if it's setting up for a more meaningful pullback.
Today’s Analysis – Friday, 8/15/25
Market Context
The overnight session has continued the theme of controlled, balanced action, with the NQ currently trading at 23,919, just 11 points below yesterday's settlement. The overnight range between 23,963 (matching yesterday's VAH exactly) and 23,872 (same area as yesterday's support) shows impressive respect for the established range from yesterday’s session.
We're set to open in balance after two sessions of consolidation following the all-time highs. The VIX continues to hold steady below 15, currently at 14.54, which suggests the market isn't showing any real stress despite the recent inflation data surprises.
Today brings a trio of data releases that could potentially nudge us out of this state of equilibrium: Retail Sales at 8:30 AM, Industrial Production at 9:15 AM, and University of Michigan Sentiment at 10:00 AM. Additionally, any news from the Putin-Trump summit could impact market sentiment, especially given the current headline sensitivity.
The Fed Jackson Hole Symposium looms large next week (August 21-23), and the market could be waiting for that, especially considering this week's inflation data. Fed rate bets were pared back yesterday after PPI showed that producers are currently absorbing inflation costs, though that won't last forever—those costs will eventually get passed to consumers.
Bias & Mindset
Longer Term Bias: Bullish
Today’s Bias: Neutral
I'm staying neutral today because the market has clearly shifted into a balanced consolidation mode after its significant uptrend. This type of equilibrium can be broken by any number of catalysts—data releases, headlines, or simply the passage of time.
The consolidation over the past two sessions suggests participants are trying to look forward and assess what impact inflation will have on consumer spending and corporate earnings. The market seems to be in information-gathering mode rather than making strong directional bets.
Here's an interesting tidbit that caught my attention: the Fed Reverse Repo facility hit its lowest level in four years yesterday. That's usually a bullish indicator for risk assets like stocks and crypto. Something to keep in mind if you're thinking the bottom is going to fall out of this market—the banks seem to disagree right now.
Key Levels I’m Watching Today
Upside:
24,068.50 — All-time high, ultimate target for any breakout attempt
24,000 — Price rejected swiftly here yesterday, putting this psychological level back in play
23,960 — Solid level for three sessions running, yesterday and Wednesday's VAH, also overnight high area
Downside:
23,900 — Yesterday's VAL, break below could indicate fair value moving lower today
23,872 — Overnight low, break below could trigger a test of prior session lows
23,841.25 — Wednesday's low, more meaningful support level
Final Thoughts on Today
When the market is in balanced consolidation like this, it can be very tempting to take trades hoping for a breakout in either direction. This approach can really chop you up and impact your capital. It's important in these environments to be patient and disciplined, taking what the market gives you rather than forcing what you want to see.
The data releases today have the potential to break us out of this equilibrium, but with headline sensitivity running high, any number of factors could provide the catalyst. The key confluence at 23,960 (three-session VAH resistance, overnight high) is particularly worth watching—that's not a coincidence. If price accepts above that level, that will be a very bullish indicator for me.
Next week's Jackson Hole Symposium will loom large, especially given this week's inflation surprises. The market may continue to consolidate until we get more clarity from the Fed about their reaction to the recent data. Sometimes the best strategy during periods like this is simply waiting for a clearer signal rather than trying to predict which way the breakout will go.
The underlying technical picture remains constructive with that Fed Reverse Repo data point, steady VIX readings, and increasing open interest during consolidation. Patience and discipline will likely be rewarded more than aggression in this environment.
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