April 7, 2025

Markets:

U.S. stock futures were hit once again on Monday as the White House remained defiant after President Donald Trump’s rollout of shockingly high tariff rates on most key U.S. trading partners has sparked a three-day market meltdown.

Trump’s initial unilateral 10% tariff went into effect Saturday. Investors were hoping for news over the weekend that the Trump administration was having successful negotiations with countries to lower the tariff rates, or at the very least, was considering delaying the set of so-called reciprocal tariffs due to take effect April 9.

Investors were surprised first by the magnitude of certain rates applied to trading partners that appeared to be based on a formula without a valid rationale based on established economic theory. They were rattled further when China on Friday decided to retaliate with a 34% tariff on all U.S. imports, instead of negotiating first.

Fears grew on Wall Street that the sell-off would feed on itself with hedge funds forced to sell down equities and other risky assets to raise cash needed meet margin calls. The CBOE Volatility Index, Wall Street’s fear gauge, surged to the 50 level early Monday, an extreme level seen mostly only during bear markets.

Portfolio:

We enter todays session, the start of what we believe will be a powerful week for traders, holding setups in TSLL and AMZU. TSLL stop adjusted to 6.50 and AMZN stop adjusted to 22.00. Have your target working on those OXY puts, could trigger at the open there.  I know it's ugly right now for the markets but the rebound to all of this will be absolutely epic.  It might be one of the most powerful rebounds we have ever seen.  Not sure when it will begins, but it's coming.  Right now we follow the trend lines.  SPY has so much work to do and we ride it lower until then.  Bears are in control short term.  Be ready today and let's find some monster opportunities for the week.