Stock Market Outlook for March 5, 2025
The new high engine in US stocks has been turned off, forcing traders to look elsewhere for strength.
*** Stocks highlighted are for information purposes only and should not be considered as advice to purchase or to sell mentioned securities. As always, the use of technical and fundamental analysis is encouraged in order to fine tune entry and exit points to average seasonal trends.
Stocks Entering Period of Seasonal Strength Today:
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Vertiv Holdings, LLC (NYSE:VRT) Seasonal Chart
Orezone Gold Corp. (TSE:ORE.TO) Seasonal Chart
Aptus Drawdown Managed Equity ETF (AMEX:ADME) Seasonal Chart
Citigroup, Inc. (NYSE:C) Seasonal Chart
QuantShares U.S. Market Neutral Anti-Beta Fund (NYSE:BTAL) Seasonal Chart
Allot Ltd. (NASD:ALLT) Seasonal Chart
Rave Restaurant Group, Inc. (NASD:RAVE) Seasonal Chart
DTE Energy Co. (NYSE:DTE) Seasonal Chart
The Markets
The implementation of tariffs on Canada, Mexico, and China had traders pushing the sell button on Tuesday as concerns grow over the impact that this protectionist measure will have on the economy. The large-cap benchmark fell by 1.22%, moving further below resistance at the 50-day moving average (5988) and reaching back to the next level of implied support around the 200-day moving average (5725). The lower limit of the short-term trading range between 5830 and 6100 has been broken and a test of the highs charted last July and August around 5700 has already been attempted at Tuesday’s low; in the short-term the aforementioned lower limit of the span (5830) is in a position of resistance and a rejection from this hurdle was also realized during Tuesday’s trading action. Momentum indicators on the daily chart have negatively diverged from price since the middle of last year, highlighting the waning enthusiasm investors had been expressing towards tech-heavy (Mag-7) benchmarks, like this, amidst extreme valuations. For now, the drawdown in the market can still be viewed as healthy and ordinary within a bull market, by any measure, but some critical levels below will warrant scrutiny, such as 5700 on the S&P 500 and 73,000 for Bitcoin. Below these thresholds, more dire scenarios for risk assets must be considered. We continue to monitor the potential impact of the apparent rotation in the market on our list of candidates in the market to Accumulate and to Avoid and we have adopted more of a neutral stance as segments that were previously noted as Accumulate candidates fall off (eg. Technology) and as areas to Avoid are added.
Today, in our Market Outlook to subscribers, we discuss the following:
- Major benchmarks intersecting with levels of significance
- New high engine in stocks has been shut off
- Investors looking for certainty in other countries
- US Vehicle Sales
- The downfall of Auto stocks during this period of seasonal weakness
- Investor sentiment
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Sentiment on Tuesday, as gauged by the put-call ratio, ended slightly bullish at 0.91, despite the spike in volatility on the day.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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