Market Analysis

SPY|QQQ Monday 1PM 7/21/2025

July 21, 2025 3 min read

Market Sentiment Analysis:

Overall Market Sentiment:

SPY (S&P 500 ETF):
Based on the recent 13 bars for SPY’s 30-minute intraday chart, we observe some interesting developments. The price action shows a slight upward trend with a support forming around the 630.50 level and resistance around 631.50. Volume has increased notably during this upward movement, indicating stronger buying interest which typically correlates with bullish momentum. The 50-period moving average on the 30-minute chart is likely providing an upward slope, reinforcing the bullish sentiment.

QQQ (Nasdaq-100 ETF):
The QQQ 30-minute chart shows a more cautious ascent compared to SPY, with prices gravitating around the 565.50 level. The volume analysis indicates a slightly less aggressive buying activity than SPY, perhaps due to underlying market concerns or sector-specific weaknesses. Despite this, the moving averages should show support around 564.50, suggesting resilient support levels, although lacking the strong bullish conviction seen in SPY.

VXX (Volatility Index):
The VXX has shown relatively stable patterns, with no significant spikes or drops in recent sessions. This stability suggests that market participants currently do not expect major volatility spikes, which typically align with a stable or bullish equity market. Therefore, this condition could imply a currently less anxious investment environment, favoring SPY and QQQ stability or growth.

Sector Analysis:

Current performance shows notable strength in the Technology (XLK), Consumer Discretionary (XLY), and Communication Services (XLC) sectors. XLK has maintained strong price levels with upward momentum, possibly propelled by strong earnings reports or technological innovations. XLY and XLC show consistent growth, aligning with increased consumer spending and media resurgences. Conversely, utilities (XLU) and real estate (XLRE) sectors lag, likely due to less favorable interest rate environments.

Key Levels to Watch:

SPY Support and Resistance:
– Support: 630.50
– Resistance: 631.50
Critical breakout levels: A close above 631.50 could suggest further bullish momentum, while a break below 630.50 might indicate a retracement.

QQQ Support and Resistance:
– Support: 564.50
– Resistance: 566.00
Watch for a breach of 566.00 for confirmation of emerging bullish momentum, while a dip below 564.50 may signal increasing selling pressure.

Scenarios:

Bullish Scenario (SPY and QQQ):
– SPY: A confirmed close above 631.50 on high volume could trigger continued rallying, supported by strong corporate earnings or positive economic data like robust employment numbers.
– QQQ: Breaking above 566 with volume surge could confirm bullish signals, driven by tech sector strength and positive retail sales, possibly reversing recent caution.

Bearish Scenario (SPY and QQQ):
– SPY: A fall below 630.50 might open doors to downside pressure, exacerbated by negative economic news or geopolitical tensions.
– QQQ: Dropping beneath 564.50 could lead to further losses, particularly if economic conditions worsen, impacting tech valuations more severely.

Overall Commentary:

The current market environment illustrates a cautiously optimistic sentiment across SPY and QQQ, with technology and consumer sectors leading performance. Potential bullish scenarios are underpinned by strong industrial outputs and tech innovation. However, vigilance is required for potential bearish shifts, due particularly to volatility in financial sectors possibly affecting broader indices. Investors may carefully navigate these nuanced movements, leveraging both sector strengths and broader macroeconomic signals to inform trading decisions.