BY ANDREW GIOVINAZZI
May 27th, 2025
Yo Pit Crazies,
The VIX is tantalizingly close to levels last seen before Trump’s announcement of another round of tariffs against the EU. If the recent market whipsaws have left you feeling confused, there’s a trading strategy currently showing a 91% win rate that could help you navigate the volatility. For those who prefer to avoid the fast pace of day trading, swing and longer-term strategies remain viable alternatives. Friday’s session saw a significant selloff, though the move ultimately failed to hold.
It was a classic case of opening on the lows and rallying back— a pattern we’ve seen repeatedly since mid-2023. Time and again, it looks like the selloffs will stick and the SPDR S&P 500 Trust (Ticker: SPY) is finished for good—but so far, that hasn’t been the case.
I see this as a prime setup for more big moves this week.
NVDA earnings on Wednesday and a Zone 4 fail on the 23rd
AI has been the primary driver of the market rally for the past two years. If Congress had a real understanding of the revenue being generated and cut spending back to pre-COVID levels, SPY could easily be trading at $650. President Trump can move the SPY by 10 points in a single day, depending on who he targets. Meanwhile, the European tariff standoff, which had been dragging on, got a jolt over the weekend.
10 day daily VIX chart
The move into Zone 4—where the VIX rises above 24—failed on Friday. Historically, failed Zone 4 breakouts tend to be bullish for equities over the following days, as the catalyst behind the selloff typically fades. If NVIDIA Corp. (Ticker: NVDA) delivers strong earnings, we could see the VIX drop back toward 18 by Friday. Given that none of the Mag7 companies have indicated any slowdown in AI-related spending, I expect NVDA’s results to be solid.
Remember Deepseek? Neither does anyone else—as the AI-driven productivity boom continues to push stocks higher.
To Your Trading Success,
AG
Andrew Giovinazzi
30-Year Trading Pro
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