The Monday Morning Playbook: Week of April 28, 2025

Good morning,

The S&P 500 rallied 4.6% last week, hitting its highest level since the April 2 tariff announcement.

Amazingly, after being down 13.8% at one point, the index is now down just 1.5% in April, and has three days to turn it positive. If it can do so, it would be the largest monthly reversal (to end positive) EVER.

And the prior record? March 2009.

However, more important than the level or where we have climbed to has been the character of the rally, and there’s plenty of good news to report there.

Leadership has turned risk-on, with energy, real estate, tech, and discretionary the best-performing sectors over the past two weeks, while defensives like healthcare and staples are barely positive.

Breadth has firmed, with two 80% up-volume days last week, including Tuesday, which saw advancers outnumber decliners by 12:1 on the NYSE and every stock in the Nasdaq 100 close higher.

Finally, arguably some of the most bullish confirmation we’re seeing comes from the alternative universe. Gold, which has acted as the ultimate safe-haven during this selloff, finally saw its extreme overbought/sentiment conditions turn into an ugly reversal last week.

Meanwhile, the more risk-on “digital gold” Bitcoin has climbed back above the key $91,000 level and hit as high as $94,000 this weekend.

Looking forward, all this increases the likelihood that April 7 will end up being the final low.

When walking through the checklist, we certainly saw extreme fear, Box #1. However, it means that Box 2 (bullish divergences) won’t be checked unless we count the slight retest we saw on Wednesday, April 9, before the tariff rollback.

That leaves Box 3 (strong breadth thrusts) as the most important thing to monitor when it comes to calling a bottom. A somewhat esoteric Zweig Breadth Thrust was triggered last week (there is some debate about whether or not it was) but the more common-man breadth thrusts I look for have yet to be fulfilled.

Combined with the overhead resistance the S&P 500 is battling, I don’t see the need to buck process for intra-month trades. However, with one week to go, it is likely that equity exposure is increased in next week’s trades and software/growth/tech will be a top area under consideration, for reasons highlighted today.

This week’s report will review:

• S&P 500 technicals

• Market breadth

• The bull case for tech/growth stocks

• May seasonality

• Alts

• Off the radar fixed income charts

• and more!