EB Weekly Market Report - Monday, May 5, 2025

Tom Bowley - May 05, 2025

ChartLists/Spreadsheets Updated

The following ChartLists/Spreadsheets were updated over the weekend:

Strong Earnings (SECL)
Strong Future Earnings (SFECL)
Raised Guidance (RGCL) - through Tuesday, April 29, will update 4/30, 5/1, and 5/2 later this week
Bullish Trifecta (BTCL)
Short Squeeze (SSCL)
May Seasonality (SEASCL)
Manipulation Spreadsheet
Upcoming Earnings

The ChartLists should be available to download into your StockCharts Extra or Pro account, if you have a StockCharts membership. Otherwise, we can send you an Excel file with the stocks included in these ChartLists in order to download them into other platforms.

The Manipulation Spreadsheet has been updated for our 3 primary index ETFs - SPY, QQQ, and IWM and our 11 individual stocks - AAPL, MSFT, NVDA, META, GOOGL, AMZN, TSLA, NFLX, AMD, JPM, PLTR, and CLS. I review this Excel file weekly. It is not meant to be updated and studied daily. I wanted to emphasize this, because we have had a few members looking for daily updates. Much of our work is done weekly, so these stocks won't be updated daily. It's more of a macro view of the various ups and downs of our major indices and what the intraday trading behavior might be suggesting.

If you have any questions, please reach out to us at "[email protected]".

Weekly Market Recap

Major Indices

Sectors

Top 10 Industries Last Week

Bottom 10 Industries Last Week

Top 10 Stocks - S&P 500/NASDAQ 100

Bottom 10 Stocks - S&P 500/NASDAQ 100

Big Picture

Last week produced a much more meaningful rally, clearing the 5521 resistance level on the S&P 500 with gusto. In my opinion, this level of bullish price behavior, combined with the strength in key intraday ratios, suggests that the early-April low is the bottom. Obviously, there are no guarantees, but I look at the RISK of something happening, not whether it ultimately happens or not. I'd say the risk of a new low later this year is quite low.

Sustainability Ratios

Here's the latest look at our key intraday ratios as we follow where the money is traveling on an INTRADAY basis (ignoring gaps):

QQQ:SPY

The QQQ:SPY ratio remains extremely bullish as money has seemingly poured into the more aggressive NASDAQ on a relative basis. This suggests to me that market participants are "risk on", a clear indication that prices are ultimately heading higher. That intraday ratio seems as though it's on a crash course with the overhead relative downtrend line.

IWM:QQQ

The good news is that the IWM was able to break back above 198 last week and close near the 200 level. On a relative basis, not much really changed. We do, however, have another Fed week upon us. Will Fed Chief Powell say ANYTHING that would lead Wall Street to believe that interest rate cuts are much closer than the Fed has been leading on? If so, keep a VERY close eye on the IWM as I believe this is the area of the market that would benefit the most from the Fed's change of heart.

XLY:XLP

Outside of the January 2023, I don't think there's been a time in the past few years when the XLY has been outperforming the XLP by such a wide margin during intraday trading. I would not expect that type of intermarket behavior just before a more significant downside move. As a result, I believe the path of least resistance for the S&P 500 is UP. We'll have selloffs from time to time, of course, but I suspect they'll mostly be well contained.

To repeat what I said last week, I still cannot come up with a bearish reason for the XLY vs. XLP to be moving up so quickly on an intraday basis.

Sentiment

5-day SMA ($CPCE)

Sentiment indicators are contrarian indicators. When they show extreme bullishness, we need to be a bit cautious and when they show extreme pessimism, it could be time to become much more aggressive. Major market bottoms are carved out when pessimism is at its absolute highest level.

Last week, I indicated that sentiment was at a point where we could see the S&P 500 roll over and perhaps start to test short-term support areas. Well, one week later, and sentiment really hasn't changed, though price action was quite bullish last week. So I'd say I still wouldn't be shocked to see price action roll over. Bulls have remained very resilient thus far, however.

253-day SMA ($CPCE)

The 253-day SMA of the CPCE has yet to find a bottom. There's no sign of a potential curl back to the upside. Accordingly, this continuing drop supports a bullish market outcome in 2025 - at least for now.

Long-Term Trade Setup

Since beginning this Weekly Market Report in September 2023, I've discussed the long-term trade candidates below that I really like. Generally, these stocks have excellent long-term track records, and many pay nice dividends that mostly grow every year. Only in specific cases (exceptions) would I consider a long-term entry into a stock that has a poor or limited long-term track record and/or pays no dividends. Below is a quick recap of how I viewed their charts a couple weeks ago:

JPM - April shows a successful 20-month EMA test
BA - major long-term support in the 120-125 range that's holding so far
FFIV - solid long-term uptrend, bouncing off 20-month EMA test
MA - another bouncing off 20-month EMA test
GS - 20-month EMA test as well
FDX - remains in a long-term uptrend, but short-term broken down; key uptrend line approaching near 180
AAPL - tested 50-month SMA for first time since last trade war
CHRW - successfully testing gap support, now trying to hold onto 50-month SMA
JBHT - has broken down on multiple time frames, would look for bottom in the 110-120 area
STX - recent low may have established Point D in an A-B-C-D-E ascending triangle
HSY - continues its descent, with its trading range now roughly 140-190
DIS - recent drop takes DIS back near price support just below 80
MSCI - uptrend still intact; this year's action has been almost entirely beneath the declining 20-month EMA
SBUX - steady decline since failed breakout, closing in on key price support near 70
KRE - fell below support range from 50.00-52.50, but now back in that range
ED - one of the best stocks of 2025
AJG - few stocks have been steadier to the upside over the past decade
NSC - been weak in 2025, but long-term chart remains solid
RHI - steady decline worsening, could we test previous double bottom at 30?
ADM - key support remains from 43-45, long-term uptrend intact
BG - 65-70 support needs to hold, another test of low likely to print positive divergence on weekly chart
CVS - trending higher with support now at rising 20-week EMA
IPG - 4-year support at 23 level now being tested
HRL - support over past 2 years still holding around 27.50
DE - one of the market's better relative performers this year, going against the overall market grain

Keep in mind that our Weekly Market Reports favor those who are more interested in the long-term market picture. Therefore, the list of stocks above are stocks that we believe are safer (but nothing is ever 100% safe) to own with the long-term in mind. Nearly everything else we do at EarningsBeats.com favors short-term momentum trading, so I wanted to explain what we're doing with this list and why it's different.

We will likely be adding several growth stocks over the next few months as we've finally seen deep enough selling for many excellent long-term performers to begin adding.

Also, please keep in mind that I'm not a Registered Investment Advisor (and neither is EarningsBeats.com nor any of its employees) and am only providing (mostly) what I believe to be solid dividend-paying stocks for the long term. Companies periodically go through adjustments, new competition, restructuring, management changes, etc. that can have detrimental long-term impacts. Neither the stock price nor the dividend is ever guaranteed. I simply point out interesting stock candidates for longer-term investors. Do your due diligence and please consult with your financial advisor before making any purchases or sales of securities.

Looking Ahead

Upcoming Earnings

Very few companies will report quarterly results until mid-April. The following list of companies is NOT a list of all companies scheduled to report quarterly earnings, however, just key reports, so please be sure to check for earnings dates of any companies that you own. Any company in BOLD represents a stock in one of our portfolios and the amount in parenthesis represents the market capitalization of each company listed:

Monday: PLTR ($273 billion), VRTX ($128 billion), WMB ($72 billion)
Tuesday: AMD ($156 billion), ANET ($110 billion)
Wednesday: NVO ($294 billion), UBER ($169 billion), DIS ($164 billion), ARM ($121 billion)
Thursday: SHOP ($126 billion), MNST ($58 billion), COIN ($51 billion), NET ($42 billion)
Friday: ENB ($101 billion)

Key Economic Reports

Monday: April PMI composite, April ISM services
Tuesday: FOMC meeting begins
Wednesday: FOMC announcement
Thursday: Initial jobless claims, Q1 productivity & costs, March wholesale inventories
Friday: None

Historical Data

I'm a true stock market historian. I am absolutely PASSIONATE about studying stock market history to provide us more clues about likely stock market direction and potential sectors/industries/stocks to trade. While I don't use history as a primary indicator, I'm always very aware of it as a secondary indicator. I love it when history lines up with my technical signals, providing me with much more confidence to make particular trades.

Below you'll find the next two weeks of historical data and tendencies across the three key indices that I follow most closely:

S&P 500 (since 1950)

May 5: +33.21%
May 6: -29.53%
May 7: -35.96%
May 8: +56.96%
May 9: -38.40%
May 10: -12.55%
May 11: -50.36%
May 12: +18.78%
May 13: -7.46%
May 14: -17.46%
May 15: +14.55%
May 16: +10.28%
May 17: -17.89%
May 18: -13.84%

NASDAQ (since 1971)

May 5: +57.18%
May 6: -47.92%
May 7: -57.62%
May 8: +73.30%
May 9: -50.55%
May 10: -16.81%
May 11: -19.11%
May 12: +33.12%
May 13: -14.57%
May 14: +18.06%
May 15: +43.61%
May 16: +49.17%
May 17: -36.53%
May 18: -9.09%

Russell 2000 (since 1987)

May 5: +8.87%
May 6: -69.89%
May 7: -90.18%
May 8: +70.06%
May 9: -26.79%
May 10: -4.79%
May 11: -50.24%
May 12: +0.46%
May 13: -80.08%
May 14: +21.52%
May 15: +39.39%
May 16: +13.56%
May 17: -22.47%
May 18: +82.33%

The S&P 500 data dates back to 1950, while the NASDAQ and Russell 2000 information date back to 1971 and 1987, respectively.

Final Thoughts

Last week, we saw a number of key quarterly earnings reports from the likes of MSFT, META, AAPL, and AMZN. This week, I feel like it's all about FedSpeak. A 2-day Fed meeting starts tomorrow morning with our major indices in the best shape since the last Fed meeting. The Fed announcement will be released at 2pm ET on Wednesday.

These are a few things I'll be watching this week.

Earnings. Most of the big companies have now reported, but there'll be several mid-tier companies reporting, including Palantir (PLTR) after the bell today.
U.S. Dollar. Thus far, the dollar ($USD) has bounced nicely off key long-term trendline support at 98. The greenback started out weak this morning, but has regained strength throughout the trading day, much like our major indices.
10-Year Treasury Yield. The TNX has risen each of the past three days, nearing 4.40% earlier today. The low on Thursday was 4.12%, so it's been a rather big upside move. What happens after the Fed meeting though? Great question.
Short-term Technical Trading Range. The S&P 500 easily broke through 5521 last week and now the key price resistance level is at 5782. The S&P 500 hit 5700 on Friday. Who would've bet on that recovery four Mondays ago when the S&P 500 touched 4835? That's nearly a 900-point gain, or 18%, in a month. Yes, it's been crazy, but it's exactly why we discussed buying into that panicked selling. It always makes more sense with 20/20 hindsight.
Leadership. It's always bullish when the 3 key aggressive industry groups - semiconductors ($DJUSSC), software ($DJUSSW), and internet ($DJUSNS) - are trading above their respective 20-day EMAs, which is exactly what they're all doing now. Eventually, we'll see a meaningful pullback. The big question will be whether these 3 key groups can maintain their prices above rising 20-day EMAs. If not, we'll likely see volatility rise significantly once again.

Happy trading!

Tom