Weekly Market Analysis and Options Trading Ideas – Week of April 7, 2025
Trade AI’s Monday Insights
Fibonacci levels shattered: how deep will the fall go?
Another heavy blow to the US market, with Thursday, April 3, and Friday, April 4, 2025, delivering a combined drop of -10.5% from Wednesday’s close.
Such dramatic moves haven’t been seen since the subprime mortgage crisis and the COVID-19 pandemic.
The 38.2% Fibonacci retracement level, perfectly respected on March 13, was broken during the April 3 plunge.
The infamous 50% level didn’t even register, and by Friday’s close, prices were already nearing the 61.8% retracement, the so-called “golden ratio.”
Strictly speaking, if the EQAL ETF traded pre-market like QQQ and SPY, even the 61.8% level would now seem unattainable. With this morning’s additional -5%, we’d be looking at new lows around 40.5 points, compared to the Fibonacci level near 42.4.
Zooming out to a broader perspective (see second chart), the ongoing correction hasn’t yet reached the 38.2% retracement of the long-term trend, which—notably—sits right around 40 points.
But how meaningful can that threshold be in a context where all economic logic seems to have gone out the window?
Only time will tell.
US Macroeconomic Data for the Week of April 7, 2025
Monday, April 7, 2025
3:00 PM (ET): Consumer Credit for February 2025 Measures the monthly change in outstanding consumer credit, including both revolving (e.g., credit cards) and non-revolving (e.g., auto and student loans). In January, consumer credit rose by 18.08 billion dollars (vs. 15.6 billion expected), with revolving credit up 8.2% year-over-year and non-revolving credit up 3%. February’s consensus forecast is 15.2 billion dollars.
Tuesday, April 8, 2025
6:00 AM (ET): NFIB Small Business Optimism Index (March 2025) Measures sentiment among US small businesses. February’s reading was 100.7.
1:00 PM (ET): 3-Year Treasury Note Auction The US Treasury will hold a 3-year note auction, settlement date April 15, 2025.
4:30 PM (ET): API Weekly Crude Oil Stock Change (prior week) The American Petroleum Institute provides a preliminary estimate of weekly crude oil inventories.
Wednesday, April 9, 2025
10:30 AM (ET): EIA Crude Oil Inventories and Cushing, Oklahoma stock levels The Energy Information Administration will publish weekly data on national crude inventories and Cushing terminal levels.
1:00 PM (ET): 10-Year Treasury Note Auction
Also, effective today: new bilateral tariffs above 10% come into force, as announced by the Trump administration. These tariffs target trade imbalances with key partners.
Thursday, April 10, 2025
8:30 AM (ET): Consumer Price Index (CPI) for March 2025 February CPI rose 0.4% month-over-month and 2.8% year-over-year.
8:30 AM (ET): Initial Jobless Claims March 29 reading: 219000 (vs. 225000 previous).
12:00 PM (ET): WASDE Report The USDA’s monthly report on global agricultural supply and demand estimates.
1:00 PM (ET): 30-Year Treasury Bond Auction
2:00 PM (ET): Federal Budget Balance Monthly report detailing federal revenue and expenditures.
Friday, April 11, 2025
8:30 AM (ET): Producer Price Index (PPI) for March 2025 February PPI was flat month-over-month, up 3.2% year-over-year.
10:00 AM (ET): University of Michigan Consumer Sentiment (preliminary, April 2025) March reading was 57.0; April preliminary forecast is 54.0.
10:00 AM (ET): 1-Year Inflation Expectations (University of Michigan) March: 5.0% (up from previous months).
10:00 AM (ET): 5-Year Inflation Expectations (University of Michigan) March: 4.1%, up from 3.5% in February.
Sector Focus: All Eyes on Defense and Aerospace
For the week of April 7, 2025, one of the hottest sectors to watch is defense and aerospace, drawing attention due to a mix of geopolitical tensions, macroeconomic signals, and industrial policy shifts.
The Trump administration’s new wave of bilateral tariffs reignited the debate on strengthening domestic supply chains, especially in high-tech and national security areas.
Europe and several Asian partners are reportedly preparing countermeasures, which could accelerate both public and private investment programs in defense.
Military orders have already shown substantial growth, particularly in defense aircraft and electronic systems.
Major contractors like Lockheed Martin and Northrop Grumman are obvious beneficiaries, but smaller niche players in components and autonomous systems could also surprise.
Historically, this sector has been less cyclical and often acts as a safe haven during times of uncertainty.
Investors looking to gain exposure can consider two thematic ETFs: ITA (iShares U.S. Aerospace & Defense ETF) and XAR (SPDR S&P Aerospace & Defense ETF), both positioned to benefit from a potential sector rotation.
Key Earnings This Week
Monday, April 7
Levi Strauss (LEVI) – After close
Dave & Buster’s Entertainment (PLAY) – After close
Tuesday, April 8
Aehr Test Systems (AEHR) – After close
Cal Maine Foods (CALM) – After close
Wednesday, April 9
Delta Airlines (DAL) – Before open
Lakeland Industries (LAKE) – After close
Thursday, April 10
Lovesac (LOVE) – Before open
Walgreens Boots Alliance (WBA) – Before open
Friday, April 11
Bank of New York Mellon (BK) – Before open
JPMorgan Chase – Before open
The Children’s Place (PLCE) – After close
Options Trading Activity: System on Pause
Another week of cautious observation rather than active trading.
The Trade AI platform experienced some irregularities in data visualization and table rendering, which led us to suspect potential reliability issues.
Historically, such technical issues suggest underlying data feed problems, so we opted to stay out of the market while the Canadian team works on fixes.
We tracked several underlyings for potential setups but did not find sufficiently convincing signals.
As a result, we chose to remain on the sidelines until conditions normalize.
