Deep Dive Update for Monday December 1, 2025

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Deep Dive Video Summary prepared for Monday, Dec 1, 2025:
Overall Market Takeaway:
After a sharp pullback the prior week, the S&P 500 had a very strong Thanksgiving-shortened week, recovering most losses and closing back above key moving averages. The short-term and intermediate-term trends have flipped back to positive; sentiment has improved from extremely pessimistic, and breadth is recovering. However, the rally has been led more by value/defensive areas and rate-sensitive small/mid-caps rather than by growth/mega-cap leadership, so the advance still feels “vulnerable” until growth stocks (especially the big tech/growth names) re-assert themselves.
Key Positive Developments:
Long-term VIX remains in a low longer-term range (below 20), MACD and short-term RSI rolling over lower → reduced fear.
Recent 5–6% pullback from the all-time high now looks like a normal decline; prior support levels (100-day MA, anchored VWAP from the breakout, Ichimoku cloud base) all held.
Regained the 20-day and 50-day MAs → short-term and intermediate-term trends positive again.
Breadth improving: Advance-decline lines making or approaching new highs (price), new highs/new lows turning up, Percent of S&P stocks above 50-day and 200-day MAs back above 50%.
Small-caps (IWM) and mid-caps surging on renewed December rate-cut odds (now heavily priced in).
Strong technical score rebound across most indexes; IWM now ranks #1, Nasdaq Composite #2.
Lingering Concerns / Things Still Being Watched:
Growth vs. Value leadership remains minimal: QQQ, semis, discretionary, biotech, tech all lagging or only modestly participating.
Key ratios still negative or flattening: Growth/Value, Discretionary/Staples (both weighted and equal-weight), Tech/Utilities, S&P-to-Staples.
Mega-caps / Nasdaq 100 underperforming the broader S&P on a relative basis.
Transports and financials (especially regional banks) still underperforming longer-term.
Value Line Geometric Index has not made a new all-time high since late 2021 → long-term negative divergence.
VVIX (vol-of-vol) 50-MA still rising; bond volatility (MOVE) still elevated relative to equity volatility.
Sentiment still “extreme negative” on some short-term gauges (though improving), while longer-term euphoria remains elevated → potential contrarian risk if everyone quickly flips bullish again.
Upcoming Catalysts This Week:
Core PCE (Friday)
Jobs report (next week)
CPI the following week
FOMC decision Dec 10 (rate cut largely expected)
Conclusion:
The S&P 500 has repaired most of the technical damage from the early-November scare and is back in an uptrend on short and intermediate timeframes. Positive seasonality and the likely December rate cut are supportive. However, until growth leadership clearly re-engages and key growth/value ratios turn higher, the rally is viewed as lower-conviction and somewhat vulnerable to renewed weakness. More follow-through to new highs with broader participation is needed for full confidence.


PDF of Slides:
https://drive.google.com/file/d/1Eoa-XzqpVpXF_QRAg6YvvB-xFS4ytcPj/view?usp=sharing

DISCLAIMER This video is for entertainment purposes only. I am not a financial adviser, and you should do your own research and go through your own thought process before investing in a position. Trading is risky!