Daily Brief - Thursday, 7/24/25
US & EU Trade Deal News Wakes NQ from Its Midday Nap; All-Time Highs Now in Sight
Disclaimer
This publication and its authors are not licensed investment professionals. Nothing posted on The Shmuts blog should be construed as investment advice. Do your own research.
NOTE:
There will be no Daily Brief tomorrow, Friday 7/25/25, or Monday 7/28/25, as I will be out of the office. The Daily Brief will return Tuesday 7/29/25.
News Docket
A fairly quiet and calm week ahead on the data release front as the market preps for FOMC next week on 7/30. Two of the Mag7 announce earnings this week with Google and Tesla on tap which will require watching as they can move the NQ.
Thursday - 7/24/25
9:45am EST - US S&P Services PMI Flash (Expected: 52.9)
9:45am EST - US S&P Manufacturing PMI Flash (Expected: 52.4)
9:45am EST - US S&P Composite PMI Flash (Expected: —)
10:00am EST - US New Homes Sales (Expected: 0.65M)
4:00pm EST - Intel Q2 2025 Earnings (Call @ 5:00pm EST)
Friday - 7/25/25
8:30am EST - US Durable Goods (Expected: -10%)
Prior Session Analysis - Wednesday, 7/23/25
Session Stats
Open: 23,261.50
High: 23,405.25
Low: 23,146.75
Close: 23,324.50
Settlement: 23,310.75
Range: 258.50 points / 1,034 ticks
Volume: 513,726
Open Interest Change: +2,170 (NQU5)
Value Area (Market Profile)
Value Area High (VAH): 23,290.00
Point of Control (POC): 23,265.00
Value Area Low (VAL): 23,170.00
Prior Session Breakdown - Market Profile and NY Session
Wednesday started as a déjà vu experience—similar opening weakness, similar support levels, similar choppy action. But then right before lunch, everything changed. News broke that the US and EU were close to a trade deal, and the market completely woke up from its midday stupor.
The opening played out much like Tuesday's script, just with less drama. Price auctioned down off the open but found support at 23,150—notably higher than Tuesday's 23,108 low. This was actually encouraging, suggesting the selling wasn't as aggressive as the day before. For most of the morning, it looked like we were headed for an inside day, with price just chopping around within Tuesday's value area.
But markets love good news, and the trade deal headlines were exactly what this market needed to hear. The response was immediate and decisive—price broke out of its apathetic state and launched into a strong upward auction that persisted through the close. The session developed into a normal variation day with upside range extension, creating a "D"-shaped profile that told the story of a market that found its mojo again.
What made this move particularly convincing was the late-session strength. Instead of the usual profit-taking into the close, we saw a powerful spike higher that left price well above the day's range. That's typically a sign that institutions are positioning for more upside, not looking to lighten up which stands in contract to prior session behavior where it appeared they were hitting the exits.
The value area rotated higher, with the VAH moving up to 23,290 and POC advancing to 23,265. Interestingly, the VAL held steady at 23,170—the same level as Tuesday. This creates a nice picture where the market is building higher value while maintaining support at established levels.
The POC's position in the lower portion of the value area reflects the morning's weak action, but the strong close above the value area suggests we're likely to see this migrate higher in coming sessions if the bullish momentum continues.
Volume & Participation
Total Volume: 513,726 – second highest in the past five trading sessions, similar to Tuesday's elevated levels
Open Interest: +2,170 contracts (NQU5) – modest but notable increase, likely new long positioning following the trade news
Price Range: 258.50 points / 1,034 ticks – increased range driven by the afternoon breakout
The volume pattern was interesting—lower activity during the morning chop, then significant spikes throughout the afternoon as the trade news drove participation higher. This wasn't the typical gradual decline in volume you usually see; instead, it was peaks and valleys that showed real engagement after the news hit.
Final Thoughts
Wednesday's session was a great reminder of how quickly sentiment can shift in this market and how sensitive it is to headlines. What looked like another grinding, range-bound day suddenly turned into a decisive breakout once the trade headlines emerged. The market's response—breaking out of the morning lethargy with conviction and holding those gains into the close—suggests this wasn't just a knee-jerk reaction.
The fact that we found support at a higher level than Tuesday (23,150 vs 23,108) and then managed to close well above the day's range is encouraging for the bulls. Sometimes all it takes is one piece of good news to remind everyone why they were bullish in the first place.
Today’s Analysis – Thursday, 7/24/25
Market Context
NQ is looking pretty bullish this morning, trading at 23,393.75, about 83 points above yesterday's settlement. The overnight range between 23,422.75 and 23,346.75 has been well-contained, suggesting the market is digesting yesterday's move rather than getting ahead of itself. More importantly, we're sitting just below the all-time high of 23,424, which makes today potentially very interesting.
The volatility environment has clearly shifted lower—the VIX dropped almost 6% during yesterday's session and is sitting around 15.23 as I write this. That's a clear signal that fear is leaving the building as trade deal optimism takes hold. We're back in a positive gamma environment where dealer behavior should continue to support any meaningful dips.
Google beat estimates in their earnings last night, which is bullish for the NASDAQ, while Tesla missed (though that was pretty much expected). The bigger story remains the US-EU trade news, and I'll be watching for any follow-up confirmation that could keep this momentum going.
Bias & Mindset
Bias: Bullish
I'm leaning bullish with medium confidence today, and here's why: the US-EU trade news was legitimately a big deal. If confirmed, it eliminates one of the major worries hanging over this market—the prospect of a trade war with one of our most important partners. That's the kind of fundamental positive that can drive sustained moves higher.
The technical picture is also lining up nicely. We held support at a higher level than Tuesday, broke out with conviction, and closed strong. Plus, we're sitting right at the doorstep of all-time highs. In a positive gamma environment with falling volatility, that's usually a recipe for continued upside.
That said, headline sensitivity remains high (as yesterday clearly demonstrated), and we've got FOMC next week. But for today and Friday, I don't see many negative catalysts on the horizon. Sometimes it's okay to embrace the optimism when the fundamentals are improving.
Key Levels I’m Watching Today
Upside:
23,422.75 — Overnight high and essentially the all-time high level
23,405.25 — Yesterday's high, first test of strength
Downside:
23,346.75 — Overnight low, should provide support in any pullback
23,290.00 — Yesterday's VAH, key support for maintaining bullish structure
23,170.00 — Yesterday's VAL, major support that's held for two sessions
Final Thoughts on Today
Today could be one of those days that defines the next move. We're sitting right at all-time highs with improving fundamentals, falling volatility, and positive technical momentum. The question is whether we can break through and find acceptance above 23,424, or if we hit some resistance and need to consolidate these gains.
We do have some data coming out—PMI Flash at 9:45 AM and New Home Sales at 10:00 AM—so be careful not to get caught in a bad spot right after the open when that data hits. But if the trend from yesterday continues, this positive gamma environment should keep suppressing big moves down while allowing gradual progress higher.
The VIX continuing to drop tells you that fear is dissipating, and in this market, that usually means good things for risk assets. As long as we avoid any negative headlines and the trade deal news gets confirmed, this setup looks pretty attractive for the bulls.
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