Last Updated: Oct. 16, 2025 at 7:55 p.m. ET
First Published: Oct. 16, 2025 at 2:06 p.m. ET
The S&P 500 index SPX had a violent and negative reaction to the threat of 100% tariffs on China — a “tariff tantrum” — and its aftermath is still affecting the market. Volatility is clearly much higher, so there has been some change in the marketplace. But there is strong SPX support in the 6,500 to 6,550 area, and that is the only support line I’ve drawn on the accompanying SPX. If 6,500 is violated, then a much more bearish scenario unfolds.
The U.S. stock market’s sharp drop on Oct. 10 generated a new McMillan volatility band (MVB) sell signal (marked with a green “S” on the chart). That market drop also increased realized volatility, so the bands have spread wide apart — meaning that the MVB signal will likely not be hitting either of its +/-4σ bands anytime soon.
