- Moving the market
The markets pulled back early in the session as hopes for new trade deals diminished following President Trump’s announcement of surprise levies on movies made outside the U.S.
He elaborated on negotiations with various countries, emphasizing that he is setting the terms of any agreement. Additionally, he made it clear that there are no plans to talk to China, which affected traders’ expectations of progress.
This week, the Fed’s two-day policy meeting begins tomorrow, with a rate decision expected on Wednesday. Futures indicate only a 3.2% chance of a rate cut, but traders will be closely analyzing any commentary from Fed Chair Powell.
Despite efforts by traders and algorithms to maintain a nine-day winning streak, the market closed in the red due to a last-hour selloff. Mixed economic data lowered rate-cut expectations, and the dollar continued to weaken.
Mega-tech stocks and the Mag7 basket managed to recover from early losses but still ended the day in the red. Bond yields rose moderately, oil prices plunged, and Bitcoin retreated.
The standout performer of the day was gold, which rallied 3% and nearly reached the $3,350 level.
Does this indicate that its recent correction is over?
2. Current “Sell” Cycle (effective 4/4/25)
Our domestic Buy cycle, which began on November 21, 2023, ended on April 3, 2025. The market reacted negatively to Trump’s tariff policy, causing major indexes and the broader market to drop sharply.
This confirmed the bearish trend that had been pushing our domestic TTI (Trend Tracking Index) below its trend line since March 10, 2025, but it wasn’t enough to end the Buy cycle until now. Consequently, we have exited the domestic market.
Meanwhile, our International TTI dropped sharply on April 4, 2025, generating a “Sell” signal. Since we did not have any exposure in international markets, we were not affected.
3. Trend Tracking Indexes (TTIs)
The S&P 500 rebounded from an early decline and nearly reached its previous level, but ultimately closed in the red due to late session selling pressure.
Similarly, our TTIs mirrored this trend, surrendering some of their recent gains.
This is how we closed 05/05/2025:
Domestic TTI: -2.15% below its M/A (prior close -1.83%)—Sell signal effective 4/4/25.
International TTI: +3.39% above its M/A (prior close +3.76%)—Sell signal effective 4/7/25.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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