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From 2008 to Today: Echoes of a Crisis?
Danny Riley
October 06, 2025
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On Friday, the ES made a low at 6754.00, rallied up to 6800.00 at 12:18, chopped around not far off the highs, and then sold off down to the 6754 area at 1:51. It rallied up to 6776.25 at 2:27, pulled back to 6765.60 at 2:54, then rallied up to a 6775.75 double top at 3:39. It traded 6772.50 as the 3:50 cash imbalance showed $1.9B to sell, traded 6765 on the 4:00 cash close, and settled at 6764.00, down 2.75 points or -0.04%.
In the end, the government shutdown and the Jewish holiday didn’t have much effect on the upside trajectory of the ES and NQ. In terms of the ES’s overall tone, it acted fine. In terms of the ES’s overall trade, volume was decent at 1.31 million contracts traded.
It's Saturday morning, and I am looking out the double doors of my bedroom over the pool, and the sky is filled with beautiful clouds and the sun is bright. But less than a mile away, the waves in the Atlantic Ocean are getting larger and larger. I don't know when or where the hurricane is going to land, but I know it's coming. But I am not just talking about the weather in Florida—I am also talking about the markets, which are both building up for something big.
Then I thought to myself, how long can some of the smartest people in the world, i.e., the 'talking heads', be wrong? I am just a regular guy, and if someone asked me what my best attributes are, I would say that I have common sense and have seen just about everything when it comes to the stock market, both the good and bad.
Date | Name / Entity | Key Warning |
|---|---|---|
9/30 | Ken Griffin | “Echoes of dot-com bubble” in AI; crash if returns fail soon; valuations stretched. |
9/28 | David Einhorn | AI boom as “biggest capital-destruction since dot-com”; recession, job risks. |
9/23 | Mark Spitznagel | Stocks may surge 20% then crash 1929-style from AI euphoria, policy shocks. |
9/13 | David Rosenberg | “Gigantic price bubble”; negative S&P returns and correction ahead. |
7/26 | Albert Edwards | “Everything bubble” to burst as higher yields hit valuations. |
6/6 | Robert Kiyosaki | “Biggest crash in history”; move to gold, silver, Bitcoin. |
5/6 | Paul Tudor Jones | Tariffs on China could drive markets to “new lows,” like 1987. |
4/7 | Bill AckmanPershing Square CEO | Post-tariff “economic nuclear winter” from trade wars. |
3/27 | Marc ChaikinChaikin Analytics founder | First crash warning since 2022; “Tech Wreck” risk ahead. |
2/1 | Elliott Management | Trump policies fueling “speculative bubbles”; record shorts. |
1/30 | Steve Cohen | Cautious on valuations; Trump policies and inflation risky. |
1/– | Nouriel Roubini | “Stagflation” from inflation + slow growth to hit stocks. |
I know I’ve said this many times, but from 1979 on, I have been part of every major stock market event, and I know I have never seen anything like this, other than the 2007 credit crisis when the Fed significantly increased its use of the discount window to provide liquidity to prevent a collapse of the financial system during the 2007–2009 global financial crisis.
In response to mounting pressure and bank runs, the Fed extended lending periods, lowered the discount rate, and ultimately saw borrowing through the discount window peak in October 2008 after the Lehman Brothers collapse. If you remember, JPMorgan acquired Bear Stearns—the first of the two to go out of business—but Bear Stearns was acquired by JPMorgan Chase with a Federal Reserve loan. The government allowed Lehman Brothers to fail, which added to the 2008 financial crisis.
I don’t know what’s going to happen, and I know some people think Friday’s new all-time high at 6800.00 is going to be the high. I’ve heard this over and over—that the high is in, the markets are going to crash—and while I can’t rule out some type of selloff or pullback, I still think there is more room on the upside. When it comes to the stock market, you are supposed to let the “good times roll”, but be vigilant. The economic and geopolitical risks both seem to be going in the same direction—up.
Like I said, this reminds me of the credit crisis—but a lot worse.
It’s 8:10 p.m. Sunday night and the ES made a high at 6783.50. So far, the ES is up xx points since the government shutdown started. One of the problems with thinking the ES and NQ go lower is the total lack of volume.
The Week Ahead
Fed Hell Week Part II is on tap. There are 20 Fed speakers, including Powell speaking at 8:30 a.m. Thursday morning, and five economic reports. The jump in Fed speak comes before the Fed imposes a “blackout” the week before each FOMC meeting, starting October 21.
Our View
There is no doubt that investors are nervous. The ES made its 31st record close, the YM its 11th record, and RTY (Dow Jones and Russell) both closed at a record, while the NQ closed down 0.30%. So far, all the concerns haven’t added up to much downside, but Goldman Sachs Chief Executive David Solomon was quoted as saying he wouldn’t be surprised by a stock market “drawdown” in the next year or two, “given the run we’ve had.”
When asked if there was an AI bubble, he sidestepped the question and said, “I think that there will be a lot of capital that’s deployed that will turn out to not deliver returns, and when that happens, people won’t feel good.” I agree with all of the above and agree that there will be a letdown at some point—it’s just a matter of when. Next week? Next month? Next year? In two years?
I don’t think the stock market is going up for the next two years, but I do think it will go up after our government officials get off their asses and pass a funding bill.
MiM and Daily Recap
Intraday Recap
The ES began Thursday’s overnight session with a muted performance. Globex opened Thursday evening at 6764.75 and quickly dipped to 6758.75 by 6:30 PM before buyers stabilized the tape. From that early low, the contract rallied through the Asian and European sessions, climbing steadily to 6784.25 at 1:40 AM. After a shallow pullback to 6776.75 at 2:00 AM, the rally resumed into the early-morning European hours, peaking at 6787.50 by 5:50 AM. Sellers emerged from that point, pressing ES back down to 6766.50 by 8:40 AM—establishing a low just before the New York open.
The 9:30 AM regular session opened at 6772.00, a small 6 points higher than the 8:40 AM low, and initially followed through on the early weakness, tagging 6754.00 at 9:35 AM before reversing sharply. A one-hour rally carried the contract to 6795.50 by 10:40 AM and then to 6800.00 at 12:15 PM, the session’s—and day’s—high. From there, momentum shifted negative as sellers gradually took control into the afternoon. The decline accelerated after 1:00 PM, breaking successive higher lows and reaching 6754.00 by 1:55 PM. A brief bounce to 6779.75 at 2:25 PM faded quickly, giving way to another leg down that printed 6760.25 at 4:05 PM. Futures finished the cash session at 6765.00 and slipped another two points to 6763.00 on the 5:00 PM cleanup settle.
Volume reached 1.31 million contracts for the full session, with 1.15 million occurring during regular hours. The contract closed lower by 1.75 points (-0.03%) on a cash-to-cash basis, modestly extending its consolidation phase after last week’s record highs. Globex gained 7.25 points overnight (+0.11%), while the regular session gave back 7.00 points (-0.10%), leaving the net daily result fractionally negative.
Market Tone & Notable Factors
Despite the small index change, tone leaned defensive throughout Monday’s trade. The early rally to 6800.00 failed to attract continuation, and each rebound attempt into the afternoon met steady supply. Sector rotation tilted clearly bearish into the close. MiM data showed a strong sell imbalance of –$1.94 billion, with 67.6% of total imbalance dollars on the sell side and –51.1% of symbols skewed lower. Financials (–$215 M), Technology (–$396 M), and Communication Services (–$501 M) led sector outflows, offset partially by modest Basic Materials buying (+$105 M). Among single names, selling pressure centered on TSLA (–$327 M), GOOGL (–$212 M), META (–$171 M), and MSFT (–$151 M), while C (+$148 M) and ORCL (+$100 M) drew isolated buy interest.
The late-day sell programs aligned with that imbalance, pressing ES from 6775 down to the 6760 area into the 4:00 PM print. Overall sentiment remains neutral-to-soft after multiple record highs last week, with rotation out of mega-cap tech tempering broader index momentum. Unless dip-buyers reclaim the 6800 handle early today, risk may stay skewed toward a short-term retracement toward 6740-6720 support.
Technical Edge
Fair Values for October 6, 2025:
SP: 46.52
NQ: 198.94
Dow: 256.03
Daily Breadth Data 📊
For Friday, October 3, 2025
• NYSE Breadth: 64% Upside Volume
• Nasdaq Breadth: 68% Upside Volume
• Total Breadth: 68% Upside Volume
• NYSE Advance/Decline: 61% Advance
• Nasdaq Advance/Decline: 60% Advance
• Total Advance/Decline: 60% Advance
• NYSE New Highs/New Lows: 162 / 13
• Nasdaq New Highs/New Lows: 448 / 51
• NYSE TRIN: 0.71
• Nasdaq TRIN: 0.67
Weekly Breadth Data 📈
For Week Ending October 3, 2025
• NYSE Breadth: 55% Upside Volume
• Nasdaq Breadth: 63% Upside Volume
• Total Breadth: 60% Upside Volume
• NYSE Advance/Decline: 56% Advance
• Nasdaq Advance/Decline: 60% Advance
• Total Advance/Decline: 59% Advance
• NYSE New Highs/New Lows: 315 / 91
• Nasdaq New Highs/New Lows: 748 / 238
• NYSE TRIN: 0.99
• Nasdaq TRIN: 0.88
BTS Levels - (Premium Only)
Calendars
Today’s Economic Calendar
This Week’s Important Economic Events
Today’s Earnings
Recent Earnings
Room Summaries:
Polaris Trading Group Summary - Friday, October 3, 2025
Friday was labeled a Capital Preservation Day, and the PTG room approached it with strategic caution. Despite the lack of the usual Non-Farm Payroll (NFP) data due to a government shutdown, the day featured solid trade setups, excellent real-time reads (especially by Manny), and a reminder of the importance of trade management and psychology.
Key Developments & Positive Trades
Strong Start:
Overnight, both ES and NQ fulfilled their upper target zones per David’s Daily Trade Strategy (DTS). ES hit 6780–6785 and NQ hit 25165–25180 early.
David called this a “Good start to FRYday” and set the tone for a day focused on capital preservation.
D-Level Setup:
David highlighted a successful D-Level Strike early in the session, reinforcing the value of reviewing the DL Money Box (DLMB) training video.
Several traders, like Roy_ and Bosier, leveraged these setups:
Roy_ shared taking a long on a pullback to VWAP with two scales out.
Bosier noted a clean trade: Long from 80.75 → scaled at 83.75 & 86.75 → held 1 contract.
Midday Clock Tracking (Manny):
Manny confirmed time-based pivots were "tracking well" with the AM low and mid-morning high hitting on schedule.
Around 12:00 PM, Manny and Bosier both reported profitable trades off 6790:
Manny: L6790, +3, +5, +10 to 6805.
Bosier: Long at 90, scaled out at 96 and 02.
Momentum Read & Fade Call:
At highs (~6805), Manny observed massive bids getting hit (50–300 lot orders), initially interpreted as fuel for a breakout.
When buyers gave up, he pivoted quickly and anticipated a rollover, calling it a “solid read” and warning others not to "pick a top" but wait for opportunity.
His “walk away” alert proved prescient as the market tanked into the afternoon.
Lessons & Takeaways
Review = Reinforcement:
David stressed the importance of repeatedly reviewing training material like the DLMB video to pick up nuances.
Audio-visual repetition strengthens pattern recognition.
Anchor in Discipline:
David praised the concept of "anchoring" — reinforcing positive behaviors and decision-making to avoid impulsive trades.
Psychological Edge:
Several comments reminded traders of psychological pitfalls:
Don’t let greed extend your targets unnecessarily.
Know when to trail out vs. attack.
"Put the ball in play" – don’t overcomplicate trades.
Structure Shift Awareness:
Manny noted a structure shift after lunch, pivoting from a long bias to short bias — great example of real-time market adaptation.
Past ≠ Present ≠ Future:
David briefly noted a Wyckoff lesson: Avoid stop-loss mistakes and don't anchor expectations to previous results.
Market Dynamics & Commentary
Institutional Unwinding:
David shared market context: Institutions offloading equities at high levels, possibly setting up for selloffs.
Manny later tied this into the Friday afternoon "conviction test", asking: Do you really want to be long into the weekend at ATHs?
Time-Based Trading Excellence:
Manny’s clock model proved reliable throughout the day.
He was particularly effective at blending setup-based trades with time pivots, emphasizing that time alone doesn’t justify a trade — setups must align.
Summary
Friday delivered a well-managed, methodical trading day with strong team collaboration, disciplined execution, and several solid profit opportunities. The room maintained a professional, strategic tone throughout, anchored by PTGDavid’s guidance and Manny’s clock tracking.
Key Wins:
D-Level strikes
VWAP pullback longs
Timely read of the afternoon fade
Key Takeaways:
Master the tools (DLMB, DTS)
Don’t chase — wait for confirmation
Reinforce positive behaviors
Time + Setup = High Probability
DTG Room Preview – Monday, October 6, 2025
Macro & Political: The U.S. government shutdown continues with no resolution in sight. The Senate remains gridlocked, the House is out for the week, and civil unrest is simmering. The Congressional Budget Office reports 750,000 daily furloughs. Meanwhile, protests in Portland led a Trump-appointed judge to block troop deployments for 14 days.
Markets: Despite political headwinds, Wall Street remains resilient. The S&P 500 and Nasdaq have now posted gains in four of the last five weeks. No U.S. economic data is due today. Fed minutes (out Wednesday) may offer insights into last month’s rate cut. September jobs report is delayed again.
Commodities: Gold is marching toward $4,000/oz, while silver eyes a return to its historic $50/oz levels as safe-haven demand rises.
Corporate News: Tesla faces pricing pressure as the $7,500 EV tax credit expires. Musk hinted at a cheaper vehicle and teased an event for Tuesday. Q3 earnings pick up with reports from PepsiCo, Delta, Levi Strauss this week. Constellation Brands reports after the bell today.
Futures Outlook: Moderate and steady volatility continues. ES 5-day ADR is 53.25 points. No overnight whale activity detected. Key technical levels to watch on ES:
Resistance: 6813/18, 6876/81, 7089/94
Support: 6656/61
The short-term uptrend channel top held Friday’s high, giving bears room to work within trendlines.
