Monday Takeaways: Markets at a Crossroads After Finding Support

Shah Gilani|March 24, 2025

Markets are like people.

They are defined by critical moments that shape the future.

We are at one of those moments right now.

Stocks are breathing a surprised sigh of relief today after President Trump walked back some of his “Liberation Day” tariff threats over the weekend.

And after weeks of downward pressure, stocks are finally finding support.

But is this rally sustainable?

We crossed the important 5,700 threshold for the S&P 500.

However, charts for star stocks, such as Apple, Amazon, and Nvidia, show significant damage.

Tesla dropped more than 55% at its worst!

Today, I’m going to explain how to analyze these seemingly incompatible market signals.

Because the next move could be the last one for quite a while.

Click on the image below to check out today’s video.

Transcript:

Hey, everybody.

Shah Gilani on here with your Monday takeaways.

It is 9:00 as I am recording this for you guys.

And guess what?

Stocks are up in the pre-market. Futures are up for the S&P 500 by about 1.2%, which is very nice. The NASDAQ Composite and the NASDAQ 100 futures are up higher than that.

This is good news for the S&P 500 and others because last week was very sloppy.

Markets have been falling for two weeks as they look for some kind of support.

Well, we may have found it this morning.

The reason they found it is because Donald Trump is walking back the “Liberation Day,” Wednesday, April 2.

It’s the middle of the week – good reason to upset markets.

But, he’s upset them in a good way.

Over the weekend he began talking about more targeted tariffs.

Markets are inferring he may not be as harsh as we thought.

Maybe things aren’t going to be so bad.

Maybe April 2 isn’t going to be this absolute monumental selloff.

So, we got a nice little rally this morning. We need it because the 1.2% rally, based on Friday’s close, takes the S&P over 5,700.

It needs to get above 5,700 and stay there.

Why?

Because it needs to consolidate there if there is any chance of the market doing better.

Here’s what we look like:

You see that 5,700 takes you up to the 200-day moving average.

Friday looked like it was going to be a sloppy day. But the little rally right into the close made things look pretty decent.

The 200-day moving average is 5,749.

If we open today with a 1.2% gain, guess what?

We hit 5,735 or thereabouts.

We’re heading towards the 200-day moving average at $5,749.

The market needs to get above the red line (the 200-day moving average).

That will give traders a reason to cover their shorts. Because if they think we are going to rally…

If they think that April 2 isn’t going to be so bad for the stock market, they’re going to have to start covering.

There are numerous shorts out there based on all this ugliness.

It could be over $50 billion as far as CTAs and commodity trading advisors go. They’re short. They’re going to have to start to cover.

So we might have a decent week going into next week, April 2.

Let’s hope for that. We need that.

If we’re going to go down, we have support at $5,350.

Now this low back here is $5,504 (March 13).

Below that is $5,350. That’s considerably below $5,504.

We don’t want to see it go down that far.

Really, we don’t want to see the market stay below the 200-day moving average.

We want to stay above the 200-day and start to move higher. That’s what we can hope for.

The takeaway here is that it looks like it’s going to be a good Monday.

Now, again, this is premarket. It’s a long day. And markets have tended to rally before the open. When we do open, we fizzle out.

Will that happen today? I hope not. Because if we fizzle out and we end up on the lows of the day the S&P 500 being up 1.2% in the premarket, that does not bode well.

A lot of data is coming out this week.

The most important is Personal Consumption and Expenditure (PCE) on Friday.

The problem with a good PCE number (PCE is lower than expected) is people assume consumers aren’t buying products. This forces sellers are to lower their prices to get consumers to buy.

Does that mean we’re heading into recess? Is the consumer starting to weaken finally?

That may be taken that way. The good news might be bad news.

PCE is going to be important on Friday, how markets interpret it and the narrative created.

Now if it’s really high, guess what?

This market is not going to like that either. Because that means if inflation is not coming down anytime soon, that’s going to reopen the other side of the debate.

Again, this is pretty ugly. The damage is out there. All of the big names have been beat up.

This is Apple:

This is downright ugly, people.

This is Nvidia:

This is just destruction.

Nvidia is trying to rally here. In the premarket, Nvidia is up 1.2%. So maybe we can rally.

Maybe we can consolidate and get back above the 200-day moving average. But a lot of damage has been done.

Now, let’s look at Amazon, the big retailer.

Again, we have to question Amazon getting hit so hard?

That’s a problem.

People, this Amazon has to consolidate down here if it has a chance of popping up. It has a long way to go to return to bull market mode for Amazon.

This is destruction, and that’s a real problem.

Tesla, I’m not even going to go there because that’s just frightening.

One of the key takeaways from last week that I found important was what Accenture reported.

Their earnings were great. They beat on the top and bottom line, all that good stuff.

However, the problem with Accenture is what they mentioned during the call, specifically regarding government contracts.

16% of their North American revenue comes from government contracts.

This is destruction here, people.

This is the earnings. Uh-oh!

They said they have a problem for the rest of the year because they think the government is going to cut many of their contracts thanks to Dodge.

Many companies have government contracts.

The question is, how many of the S&P 500 companies have significant revenue tied to government contracts?

This is something the market has to be aware of because a lot of those contracts are going to get vaporized.

It’s a problem for future earnings, and that’s what happened to Accenture. But the anticipation that they’re going to lose government contracts caused this to sell off already. That’s ugly.

How many other companies will face that?

How many other companies will have to lay off their employees?

What is the recession picture going to look like if, all of a sudden, unemployment jumps because of cuts?

What will it look like if work is suspended because the government stalls or cancels contracts?

There will be some interesting things out there.

There is a lot of stuff to watch.

Accenture just hit me yesterday when I was looking at the past week, and it stood out as important.

The takeaway from all of this is there is hope for the market this morning that maybe we can see a bump.

Maybe we can get above the 200-day moving average.

Maybe we can consolidate.

Maybe the Donald will turn around and flip-flop, and the next thing you know, he’ll come out pounding the table saying we’re going hit everybody with tariffs.

That’s the world we live in, people.

And those are your takeaways for this Monday.

I’ll catch you guys next week.

Cheers.