SPY|QQQ Friday 4PM 12/19/2025

December 19, 2025 3 min read

Market Sentiment Analysis:

Overall Market Sentiment:

SPY (S&P 500 ETF): Examining the last 13 bars (6.5 hours) in the 30-minute chart, SPY has shown moderate price stability with a slight upward trend. The volume spiked significantly in the last session of trading, suggesting a potential accumulation phase or renewed interest. The moving averages, if applied to this timeframe, will likely show a flattening with a slight upward bias as prices incrementally increased half an hour before the market close. This indicates cautious optimism but requires confirmation in the next few sessions.
QQQ (Nasdaq-100 ETF): Similar to SPY, QQQ has displayed a steady pattern in the recent 13 bars with a consistent close around the high during the final trading session, hinting at underlying strength. Volume patterns appeared modest with a decline near the end, unlike SPY, suggesting less aggressive buying. However, the closing action indicates potential breakouts should market conditions remain favorable.
VXX (Volatility Index): There was a noticeable drop in VXX during the last trading hours, reflected by reduced trading volume—an indicator of decreasing fear or volatility in the market. This drop aligns with the minor rallies in SPY and QQQ, suggesting improved investor sentiment, possibly driven by anticipated positive economic indicators or data releases.

Sector Analysis:

Reviewing the sector ETFs:

Strong Sectors: XLK (Technology) and XLV (Health Care) have shown resilience and minor upward movement recently, reflecting sector strength or rotation into less cyclical sectors, perhaps due to shifts in investor sentiment towards growth and defensive stocks.
Weaker Sectors: XLU (Utilities) and XLRE (Real Estate) appear weaker, with consistent downward pressure during peak trading sessions. This might imply sector rotation away from traditionally safe sectors as market participants could anticipate a more robust economic outlook.

Key Levels to Watch:

SPY: On a daily candlestick view, immediate resistance can be identified around 682, with support near the 678-679 range. A break and hold above resistance could signal a continued uptrend. Conversely, dipping below support could prompt further sell-offs.
QQQ: Resistance is noted near 618, with 615 as critical support. Sustaining above the resistance level may lead to a bullish continuation, while failure to maintain above the support might shift sentiment bearish.

Scenarios:

Bullish Scenario: Positive economic data, robust technology sector performance, and easing global tensions could push SPY above 682 and QQQ above 618, driving momentum-based buying and sustained rallies.
Bearish Scenario: Unexpected negative economic news, disappointing earnings in key sectors, or heightened geopolitical risks could cause SPY to fall below 678 and QQQ under 615, potentially accelerating a bearish move across the broader markets.

Overall Commentary:

The current market environment suggests cautious optimism with volatility on the decline. Sector performance indicates a subtle shift favoring technology and health care, potentially stemming from economic confidence or sector-specific strengths. However, vigilance is necessary given the pivotal support and resistance levels across major indices, which could quickly sway sentiment. Traders should observe how these levels react to upcoming economic releases and earnings reports, tailoring strategies to align with newfound momentum or caution.