S&P 500 Faces Rising Uncertainty Ahead of Earnings Season
Published: July 14, 2025
Author: Paul Rejczak, Stock Trading Strategist
Market Overview
The S&P 500 index closed 0.33% lower on Friday amid tariff-related uncertainties. Following news of potential new tariffs on Europe from President Trump, S&P 500 futures experienced a sharp decline. However, the market has since recovered, and the index is expected to open only 0.2% lower.
Investor Sentiment and Earnings Season
Investor sentiment remains elevated, as indicated by the AAII Investor Sentiment Survey, which shows 41.4% of individual investors are bullish, while 35.6% are bearish. Attention is now shifting towards the upcoming corporate earnings season, with major banks set to report their earnings soon. Additionally, key Consumer Price Index (CPI) data will be released, making Tuesday's session particularly significant.
Technical Analysis
The S&P 500 continues to consolidate in the short term. The daily chart indicates that support remains near the 6,150 level, while resistance is currently at 6,300. The Nasdaq 100 also dipped 0.21% on Friday, continuing its consolidation within an ongoing uptrend, although recent price action may suggest a potential topping pattern.
Volatility Index (VIX) Insights
The Volatility Index (VIX) dropped to a local low of 15.70 on Thursday, indicating strength in equities. However, it rebounded to a daily high of 17.24 on Friday, despite calm market conditions. Historically, a declining VIX suggests less fear in the market, while a rising VIX often accompanies stock market downturns. The current VIX levels indicate a higher probability of market reversals.
Futures and Oil Market Update
This morning, S&P 500 futures are rebounding from an overnight low of around 6,258, following initial weakness due to tariff headlines. The index remains in consolidation, potentially forming a topping pattern or a flat correction before another upward movement. Resistance is around 6,320, with support near 6,250.
In the oil market, crude oil prices rose 2.82% on Friday, continuing a rebound from a previous sell-off. As of this morning, oil is trading above $69, driven by expectations of tighter global supply due to increased Chinese imports and potential new U.S. sanctions on Russia. Current resistance for oil is around $70-72, while support is between $68-69.
Conclusion
The S&P 500 is set to open slightly lower on Monday, but the market tone remains cautiously bullish, especially given the quick recovery from the weekend's futures drop. With ongoing tariff-related news, investor focus will shift towards the start of earnings season and the upcoming CPI data.
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