Daily Brief - Monday, 5/12/25
From Friday’s Drift to Monday’s Lift — NQ Goes From Sleepy to Screaming on China Tariff Deal Hopes
Disclaimer
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News Docket
Tuesday - 5/13/25
8:30am EST - US CPI YoY (Expected: 2.4%)
8:30am EST - US CPI MoM (Expected: 0.3%)
8:30am EST - US Core CPI YoY (Expected: 2.8%)
8:30am EST - US Core CPI MoM (Expected: 0.3%)
Thursday - 5/15/25
8:30am EST - US Retail Sales MoM (Expected: 0.1%)
8:30am EST - US PPI YoY (Expected: 2.5%)
8:30am EST - US PPI MoM (Expected: 0.2%)
8:30am EST - US Core PPI YoY (Expected: 3.1%)
8:30am EST - US Core PPI MoM (Expected: 0.3%)
8:30am EST - US Initial Jobless Claims (Expected: 220k)
9:15am EST - US Industrial Production MoM (Expected: 0.1%)
Friday - 5/16/25
8:30am EST - US Housing Starts (Expected: 1.365M)
10:00am EST - University Michigan Sentiment Prelim (Expected: 53.3)
Prior Session Stats & Analysis - Friday, 5/9/25
Session Stats
Open: 20,227.00
High: 20,279.75
Low: 20,058.00
Close: 20,136.25
Settlement: 20,136.75
Range: 221.75 pts (887 ticks)
Volume (Est.): 454,076
Open Interest (Prelim, NQM5): +172
Value Area (Market Profile)
Value Area High (VAH): 20,175.25
Point of Control (POC): 20,119.00
Value Area Low (VAL): 20,100.25
Market Profile View – 30-Min Chart
Friday was a Normal Variation Day with range extension to the downside, though that extension ultimately failed.
After the initial selloff, price climbed back into the value area and closed within it, signaling a balanced session overall.
The Initial Balance (IB) was wide, thanks to the ~150-point drop in the first two TPOs.
The rest of the session was choppy and range-bound, holding mostly between 20,080 and 20,180.
📌 Notably:
No single-print tails or excess on either end — another sign of a balanced auction.
POC and value area rotated downward from Thursday, reflecting the slight bearish tone.
The session had all the hallmarks of a market awaiting more information — and over the weekend, that came in the form of China tariff headlines (more on that in today’s pre-market plan).
5-Minute Chart Breakdown – NY Session
After a bit of chop off the open, the market quickly auctioned down ~150 points within 25 minutes.
VWAP was in play, offering two solid short setups for those dialed into it.
Beyond that, there wasn’t much edge unless you were actively range trading — and even then, the range was tight at just 221 points.
In hindsight, Friday was a textbook “sit out” session, and I’m glad I did.
When the market’s not offering structure or follow-through, capital preservation is the trade.
Volume & Participation
Open Interest: +172 — very weak participation; ES was -2,163. Don’t be surprised if NQ finalizes negative.
Volume: ~454k — lowest in three sessions
Range: 221 points — small and compressed, reflecting limited participation and direction
Final Thoughts
Friday was a low-energy, low-conviction session — not uncommon heading into a weekend with macro risk on the table.
The early selloff failed to build momentum, and the rest of the day devolved into sideways indecision. With no conviction from larger players, this was a day best avoided — and it was.
Sometimes, your best trade is knowing when not to take one.
Pre-Market Plan – Monday, 5/12/25
Market Context
NQ is up big this morning — +800 points (~4%) above Friday’s settlement — following concrete progress on a trade deal with China aimed at lowering tariffs and easing trade war tensions.
This is exactly the kind of clarity the market had been hoping for — and it’s triggered a massive risk-on reaction overnight.
But while sentiment is euphoric, headline risk still lingers.
Stay sharp. The tape is fast, and sentiment can shift quickly if the story evolves.
Longer-term, we still don’t know what the final earnings impact of tariff changes will be — and that may take another full quarter to play out. Also worth noting: up through Friday, the rally was built on weak structure, with dealers still short gamma.
Today, I’ll be watching options flow closely. If this is more than a knee-jerk reaction, we should see:
Increased call buying
Put positions being closed
A shift in gamma exposure
That would help solidify this move as a true change in sentiment — not just another squeeze on hope.
Bias & Mindset
Bias: Bullish
As of writing, NQ is just shy of 21,000, and all major indices are poised to retake their 200-day moving averages — a key signal of potential sentiment shift.
Two likely scenarios today:
Volatile, choppy session — where the main move happened overnight, and RTH sees indecision or fade as participants digest.
Continuation move — where a minor pullback off the open is followed by a trend day higher as cash session participants pile in.
With such a massive overnight move, it’s fair to ask:
How much buying power is left?
Have most of the positions already been established, or is there still fuel?
As always, headlines can shift tone instantly, so I’ll be laser-focused on price action and ready to react, not predict.
One thing is clear: I won’t be fading this move today.
It’s either a long trade or no trade — I won’t step in front of momentum without a reason.
Key Levels I’m Watching Today
To be honest, levels may not matter much today.
We haven’t traded at these prices in over two months — and the last time we were here, sentiment was bearish. Today, it’s very different.
So instead of trying to guess which resistance might hold in this unfamiliar terrain, I’ll be:
Letting structure develop
Watching VWAP and developing value
Staying reactive to order flow and momentum
This session will help define reference points for the rest of the week.
Upside Targets:
Downside Levels:
Final Note on Today
This is a market running on headlines and momentum, not structure.
Keep a clear head, don’t chase blindly, and don’t fight strength without reason.
Trade what’s in front of you. Don’t force it.
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