1. Moving the market

Equities surged after the opening bell as reports suggested that Trump might delay some of his broad tariff plans. Traders and algorithms quickly shifted to “Buy” mode, fueled by hopes that a global trade war could be averted.

Trump has indicated that tariffs target any country imposing duties on U.S. imports. However, the Wall Street Journal noted that the tariffs might be narrower in scope, focusing more on specific industries rather than broad impositions, with some nations potentially being excluded.

While Trump may show more flexibility in his approach, the situation remains fluid. For now, the effect on major indexes is positive and supportive. The markets also received a boost from Fed Chair Powell last week, who commented that any negative impacts from Trump’s tariffs would likely be short-lived.

Despite mixed results from the Services and Manufacturing PMIs, bond yields rose, and the indexes closed at their session highs, driven by an explosive short squeeze. Tesla, which had been struggling, managed a 12% comeback following reports that the FBI launched a task force to investigate the terror attacks.

Atlanta Fed President Bostic stated that inflation would be bumpy and not move dramatically towards its 2% target, which reduced expectations for rate cuts.

The dollar closed unchanged, gold slipped but found support at $3,000, and Bitcoin surged back above $88k to a three-week high.

Could this be the beginning of the next leg higher based on historical precedent?

1. Moving the market

Equities continued their recovery from the recent selloff, buoyed by some positive economic data.

However, late-session uncertainties led to a red close for the major indexes, as concerns grew that the Fed might not be able to significantly cut rates in 2025 due to potentially inflationary trade tariffs starting on “Liberation Day,” April 2nd.

Some traders believe these economic concerns are exaggerated. Fed Chair Powell stated that the economy is “strong overall” and that his policy is “in a good place” to respond to any signs of weakness. He also described the potentially inflationary effects of tariffs as temporary.

Sales of existing homes in February rose 4.2% from January, defying expectations of a 3% drop. Jobless claims increased only slightly from last week, with layoffs remaining low. However, Leading Indicators fell to their lowest level since November 2016, as noted by ZH.

After an early bounce, the Mega-Cap tech sector reversed yesterday’s gains, mirroring the pattern of the most shorted stocks. Bond yields were mixed, rate cut expectations rose, and the dollar advanced.

Despite the dollar’s gains, gold closed higher, reaching the $3,050 level. Bitcoin surged early on but gave back its gains late in the session.

Today’s trading was largely uneventful, but the positive takeaway is that we are nearing the end of the seasonally weakest period of the year.

Will April align with its historically bullish trend?

1. Moving the market

In anticipation of the Fed’s policy announcement, equities climbed higher early in the session and continued their upward trend, joined by bonds, gold, and cryptocurrencies.

While no change in rates is expected, traders are keen to hear the Fed’s outlook on two potential rate cuts this year. They will also be listening for insights on how the Fed evaluates the current economy, given the trade tensions created by tariffs.

Alongside the interest rate decision, Fed Chair Powell commented on GDP, inflation, unemployment, and the possibility of “stagflation.” His remarks were both dovish and hawkish, but traders interpreted them positively, leading to a broad market rally.

Powell also addressed Trump’s tariff agenda, stating that tariff inflation can be transitory if inflation expectations are anchored.

The most shorted stocks were squeezed for the third time in four days, bond yields retreated, rate cut expectations increased, and even the dollar ended slightly higher despite a midday dip.

Gold surged above $3,050, Bitcoin approached $86,000, and crude oil recovered some of its previous losses.

It was a strong comeback day for all markets, with our domestic TTI now close to crossing back above its long-term trend line.

Is the bull market about to resume its trend again?