Check out an interesting chart of options trading ahead of the rally. 
Trumped Waved the White Flag
Amid the turmoil, Treasury Secretary Scott Bessent convinced Trump to do a 90-day pause.
The stock and bond markets instantly reversed and the Dow shot up nearly 3,000 points, about 7.8 percent. The Nasdaq rose 1,857 points up 12.2 percent, and the S&P 500 rose 474 points up 9.5 percent.
Who did Trump or Treasury Secretary Bessent tell?
Shorts Covered What Now?
The market, at least for now is thinking a bit more clearly so far today, but nothing today would surprise me.
This is an IF but not an unlikely one, IF yesterday’s rally cleared out most of the shorts, there is nothing but a huge air pocket below.
Stock Selloff Accelerates as China Trade War Sinks In
After a brief hiatus from reality, Stock Selloff Accelerates as China Trade War Sinks In
U.S. stocks opened lower Thursday and declined sharply heading into midday, as investors sort through a global economic outlook that has improved drastically over 24 hours but remains uncertain.
Bank stocks and tech shares were hit hard, retracing some of Wednesday’s epic gains. Wall Street’s fear gauge, the CBOE Volatility Index, was rising though far below levels of earlier this week. Nasdaq, which posted its biggest gain since 2008 on Wednesday, gave half of it back Thursday, declining 5%.
Trump’s reciprocal tariffs on nearly 100 nations took effect Wednesday. Later, as he paused the levies on other nations, Trump said he had raised China’s import tax to 125%.
In return, China said Thursday it would reduce imports of American movies, another bid to strike at U.S. services exports in an escalating trade war between the two countries.
Goldman Sachs cut its growth outlook for China, citing the impact of tariffs. The bank now projects China’s economy will expand 4% this year and 3.5% in 2026.
Trump Tariffs on China Actually 145%, Says White House
The tariffs imposed on China by President Trump in his second term add up to 145%, the White House said on Thursday—not 125%, as it previously indicated.
The 125% tariff that President Trump announced on Wednesday afternoon referred only to reciprocal tariff levels, a White House official said, and did not take into account the 20% tariffs Trump had previously levied on China over its role in the fentanyl trade.
When the fentanyl-based tariffs are added, the second-term tariffs are 145%, which are also stacked on top of product-specific tariffs on China that Trump imposed in his first term and then-President Joe Biden expanded.
As I have commented before, these are now meaningless numbers. Above 100 percent most trade will stop. Another 5,000 percent won’t do anything.
However, the “Made in Vietnam” trade is back on. Look for goods from China to filter though as coming from Vietnam.
This tariff avoidance scheme was in play in Trump’s first administration as well.
Trade Deficit with China is Understated
For an explanation of tariff avoidance via Vietnam please see my January 18, 2025 post The US Trade Deficit with China is Understated by as Much as 30 Percent
Normal trade math does not add up. US imports and China exports are not in sync.
According to Brad Setser, Chinese exports started exceeding US imports only in those categories with tariffs, and only after the tariffs were imposed.
I commented “This appears to be an amusing case of China cleverly avoiding US tariffs but not clever enough to hide it better.“
This appears to be an amusing case of China cleverly avoiding US tariffs but not clever enough to hide it better.
I was wrong about one thing. I did not think Trump would really be stupid enough to break USMCA.
Excluding Oil, the US Has a Trade Surplus with Canada Every Year Since 2008
For more on Canada, please see see Excluding Oil, the US Has a Trade Surplus with Canada Every Year Since 2008
Let’s do a fact check on Trump’s Canada claims.
Finally, Please read over and over Cheese Was a “Key Achievement” of Trump’s USMCA Trade Agreement
The above post contains over a dozen instances in which Trump bragged what a great deal.
It was such a great deal that Trump thanked Mexico and Canada. Notably USMCA is “Good for everybody – Farmers, Manufacturers, Energy, Unions – tremendous support. Importantly, we will finally end our Country’s worst Trade Deal, NAFTA!”
We had a great deal with China. Then Trump pissed in their face.
A rally off bear market routs, stocks typically retrace half their gains. The aspect in this event was huge gaps in price (both rallies and routs), which indicate large option trades by corporate brokers. Options before the rally could be from insider knowledge, or the indexes having crossed below long-term moving average trend lines, while internal technical market statistics were highly oversold. This activity could be a reflection of the overall record high S&P margin debt.
if it vanished, did it really exist? is all of wall street merely a fantasy of values? a castle of clouds built upon a foundation of sand that can vanish in a gentle rain storm forever?
“Reality does not need another reality to bolster it.”
~ Jorge Luis Borges
“Reality works in overt mystery.”
~Mendocino Fernandez
Every day, amazingly, people continue to have no idea what is going on. Trump’s plan is not nefarious or conspiratorial except to those who are prone to only see those options.
I hope some will remember tomorrow…and the next day…and the day after that…the plan is the same, overt, and working:
The Plan: Train other countries and politicians to believe there is always a carrot along with the stick. That’s it. Anyone who has been alert enough to spot this pattern…and TONS of people have been, knew the market would crash with the stick and recover with the carrot. World leaders are prideful, they would not capitulate pre-emptively because it is bad form but there could be no doubt they would take the carrot as soon as it was shown to be the correct step forward.
The world sees the reality, and quite obviously.
Trumps actions are the largest tax increase in history and the largest regulatory encroachment on the day to day operation of free enterprise.
Exactly the opposite of what he campaigned on. The pretense of your quotes shows that your arguments are weak as you play the sycophant card instead of having your own arguments and credibility.
Sure trump has screwed and raped a great number of women and he has screwed and raped many people that trusted him in business. His bankruptcies are legendary. All of it was to benefit himself and his little wounded ego. He is doing nothing for the U.S. or its allies. Our farmers are losing market share again and other nations will be the direct beneficiaries. The American people will be paying the subsidies, or many of our farms will fail.
Sad times as the dollar slides and bond yields rise.
Next, corporate revenues and profits will fall and tax collections drop just as he piles on the debt.
I am not fooled and neither are the markets or the majority of our readers.
Trump’s MAGA will almost certainly bring the world economy to recession if not depression.
Honestly, I was looking at QQQ and SPY as a day trade because RSI was 21!!!! Basically right around the same time as the whole market capitulated (at least in the short term.) So it’s not unlikely that bigger players were programmatically buying calls .The force index was indicating a slowdown in selling. Any consumer trader would be looking at that as a buy. Big moves up happen in Bear crashes. See 2008. You can get a quick 10% just doing that. Also, if you are typing a TWEET or figuring out a message news is going to leak fast. I bet X knew he was typing that and before send button goes the backend knows and the HFT bots are already on the job
Trump may not know tariffs but he is intimately knowledgeable about debt/bonds. His companies went bankrupt on more than one occasion. I am sure he experienced a bit of Deja vu when he saw the bond market crashing. Creditors calling loans or demanding higher rates for increased risk. He probably used up his supply of Depends.
Did Trump just wink at the gold buffalos?
Wow that’s cray cray
The family has dual Danish and American citizenship. Shull is unusual, perhaps unique: an uncompromising supporter of Donald Trump and a self-described American patriot who is also a committed Greenlander, proclaiming his intention to live there for the rest of his life. At different times in our conversation he used ‘we’ to mean ‘we Americans’ and ‘we Greenlanders’. He’s strongly against America absorbing the island.https://www.lrb.co.uk/the-paper/v47/n07/james-meek/everything-is-possible?ref=thebrowser.com
Nice article. Read all of it.
Are we filling up the SPR at these prices? We sure as hell should be
Trump is far too busy grinding the axe of vindictive revenge to think about things like strategy and wisdom
We don’t need it because we pump all the oil we need now. The SPR is redundant.
Nope. We pump around 13.5 mbpd but we export roughly 4 mbpd of shale oil because we can’t use it all in our refineries.
So we import around 6.5 mbpd of heavy oil in order to meet our refining needs.
Even if we could use every drop of shale oil in our refineries we would still need to import some oil.
Here is some info about the SPR.
During Trump’s first term, the SPR declined from 695 mb to 638 mb. This had nothing to do with Trump. The decline was due to 3 acts of Congress from 2015 to 2018 which mandated SPR sales over the next decade in-order to raise funds to help with budget spending. Congress made this decision as a result of the huge increase in shale oil that the US began producing; thinking that this would reduce the need for the SPR. They planned to slowly reduce the SPR to 347 mb of oil eventually, or half the 695 mb.
When Biden took office in January 2021, the SPR contained 638 mb of oil. The mandated congressional sales continued and the SPR declined to 591 mb.
When Russia invaded Ukraine, Biden then announced an additional 180 mb of sales, in addition to the mandated sales. As a result, the SPR declined to 347 mb by mid 2023, which was Congresses long term target.
At this point, the Biden administration said they would cancel future mandatory sales, and begin refilling the SPR. Part of the reason for this was because they sold the SPR oil at around $95/bbl, and the re-purchases are at around $75/bbl.
To refill the SPR requires an order from the President, money from Congress, and the DOE to contract out the purchases.
Congress gave Biden “some” money and to date, we have refilled the SPR by around 50 mb to around 395 mb at present. But that money has all been spent.
Energy secretary Chris Wright is asking Congress for another $20 billion in-order to add another 300 mb of oil to the SPR over the next decade.
We will have to see if Trump will sign the order and Congress will provide the money.
Hope that helps.
Trump is waiting for $40
Once again Happy Liquidation Day. The Gamblers are getting called on their bets and have to show their cards.
moving on: How the Pentagon is adapting to China’s technological riseMIT technology review: https://www.technologyreview.com/2025/04/07/1114242/kathleen-hicks-on-china/
And Trump wins another SCOTUS round. This one against the American Federation of Colleges and a bunch of other plaintiffs. On elimination of DEI. That’s now 6 wins in 7 days.
You are not keeping your readers up to date.
You could be correct on tariffs. Although I think not. But I don’t know enough about them to comment. So I don’t.
But I do know how the legal system works. And I’ve spent 1/3 of my life inside the system. So I’ll be sure your readers are informed.
We sure were kept up to date on court cases he lost though.
Yes, some of us really appreciate your ‘good calls’ on the legal matters.
I told everyone I knew about how an Eric online assured me on MishTalk that Gaetz was guaranteed to be the next US Attorney General because of how Trump could use untested, but tenable legal theories to make it happen.
Now they don’t listen to me any more. Oh well, live and learn to trust (or not) random self-assured Erics on the interwebs
LOL. I love you Hubris
Shouldn’t give them a cent, regardless of DIE issues.
DIE works better than DEI …
Please don’t feel the need , in fact I would be happy if you don’t bother.
1 PM EST: When one third becomes two thirds
A very good thing happening now is the weakening of the Dollar. It was trading at almost parity with the Euro making it historically much too strong. The last time we saw this amount of strength was back in 1999. Ten years ago it was trading at 1.40 Dollars to the Euro and then in 2014 it started its strengthening trend. Needless to say a Dollar this strong is bad for companies trying to export but the worst part is that has created a self-reinforcing upward spiral in the capital account that is the flip side of the trade deficit. We import more and more paying for it in Dollars which are cycled back into treasuries, stocks and direct investment into real estate. This is causing the Dollar and real estate to continue their upward trends when from the point of view of fundamentals the Dollar, stocks and real estate are all horribly overvalued yet the trend perdures. If this continues like this then we will be dead.
For once we have a team that recognizes the problem and is using all the levers to break this trend. It should have been done before but as we know there were powerful incentives for certain groups to see this continue because they were making easy money. This tariff question is only a part of the process. While many people see only the tariffs they are ignoring the fact that the negotiations include much more than just tariffs. It would be nice to have a discussion on the capital account side for a change.
Indeed
I don’t see any strategy or plan here, I see the capricious actions of a demented wannabe dictator. Any gains in exports to be made off the weakening dollar will be more than offset by the reciprocal tariffs the EU will impose on the US and on the increasing costs to US consumers on our imports. A depression is on the way.
If you have already made up your mind then nothing I say will change it.
What he doesn’t see, you can show him the light, or you can fold like Trump on tariffs. It’s a choice.
I have neither the time nor the inclination to spoon-feed to him what he should have seen already if he had studied the subject a bit.
Where did he fold? Do you mean like the fake / novel so called felony conviction? Lulz.
Blah blah blah blah. Repeated endlessly thru the thread.
60 pts 1 min ES.
Well Team Trump did smash a market buy on deep OTM weekly calls making them innumerable millions.
Please share Team Trump’s trading records with us. Or are you just just guessing?
Did Trump just say he was only kidding?
Most of the US exports to China are agricultural products, whereas the latter exports mostly industrial products to the former. That is, China can tariff US imports and source alternatives from other countries, like Brazil and Russia, whereas the US cannot find alternatives so easily or at all. China has the cards, not the US in trade, since, as an industrial economy, its exports aggregate more value than the US’.
Hen Hao.
Yeah there were a number of CCP posts yesterday as well.
I think this place is infested with them.
Trump can go nuclear: 150% surcharge on Chinese take-out food.
It is not unusual for the market to give gains back after a huge day. As a matter of fact, the day after QQQs were up over six percent they gave some back 40/40 times. On average, the huge gain was completely erased the next day.
Above the 382 retrace to yesterday’s lows, would call it a stick save and a beaut.
With vol this high and moves of such magnitude, its always hard to remember how long it takes for markets to balance out and digest. Oscillation, not straight lines.
May smell like teen spirit to some, but would say NYFed. It always helps to take losses when there’s a nice conspiracy theory to fall back on.
Fed is political. Their actions last year were criminal.
Preaching to the choir.
Drama and trauma. Like the financial crisis. Geico pig hanging out the window with a streamer, wheeeeee!
Trump was in the steeple of the Old North Church, signaling “one if by land, two if by sea.” Nicholas Cage used special spectacles to spot him.
The “paused” tariffs will cost an average household $4500/year
We are the highest big nation in terms of tariffs
Business investment planning is screwed WRT the US
We have alienated our allies
The US is no longer a reliable partner in trade and policy
60% chance of recession (too low)
So much winning
Fun with made up numbers.
Shhh. What is that? I hear a baby crying!
Not me. Close to 618 retrace. Machines running the show, pretty parabola on 15 min VIX candles breaking into 55.
Americans voted for a president who would engage in insider trading. Everyone HAD to know this would happen. The guy never showed any tax returns. He has always given off these vibes. Anyone who voted for him who is hurt financially by this mess deserves it, plain and simple. Vote for a felon to become president, expect to be violated and for him to commit more crimes.
Bring Back Sleepy Joe b/c muh portfolio.
Trump told the whole world to buy shortly after the market opened yesterday. Don’t cry about insider trading because you didn’t listen to him.
It’s hard to put up with so many apologists for someone who’s been a criminal most of his life, including sexual assaults, tax fraud, tax evasion, payoffs, bank fraud, business fraud….he’s a convicted felon and would have been convicted of stealing and lying about secret and top-secret intelligence documents as well as conspiring to overthrow an elected government….but he got elected so he was prosecuted. A terrible day for America when lunatics put Trump in power. Now he’s attacking and removing anyone who would be a threat to his power including investigators for military intelligence, FBI intelligence and I assume he’s done the same thing across the board. With his inane tariffs, Trump has done a lot of financial damage to America. Who will save America from the most dangerous man in America…Donald Trump?
Does your therapist have to listen to this?
So as long as it’s the president spreading insider information it’s all good. Got it.
It’s not insider info when you announce it publicly. Don’t listen to me though, surely you got him this time!!!
50 million people heard the same message at the same time. That is the opposite of insider trading.
Insider made billions with meme coins and who listened to him lost billions.
You’re absolutely right. Many were short in the market prior to Trump’s reversal of the big tariffs….and they got destroyed. Trump is an accused and convicted liar, tax cheat, business cheat, who engaged in payoffs and bank fraud. He’s very dangerous and should be removed. He’s gutted the DOJ prosecution staff, installed loyalists to head DOJ, compromised the FBI with Kash Patel, a Trump loyalist. Military intelligence, NSA and military intelligence personnel have been transferred or removed….it looks like a coup and corruption of our intelligence services by Trump and his proxies.
Convicted of what?
In my country whenever the government make the new law or change the law, the government officials have the new opportunity to make money.
More important were great inflation numbers this morning. This even before the extended commodities like oil which have gone down a lot and will weigh further on the numbers.
The inflation numbers were just a minnow on the line to trap longs.
Wow, THAT TRADE IS CRIMINAL!
YESTERDAY – This is beyond obscene AND REALLY CRIMINAL! Trump braggin how many $ billions and Millions he made his Billionaire buddies RIGHT IN FRONT OF THEM!
https://x.com/i/status/1910238378064257143
Yesterday was an opportunity to sell into the AI bubble. Nothing more.
LOL downvotes from people who believe that Trump cares at all about working class folk one hundredth as much as his rich billionaire buddies. Keep being his huckleberry, you’re only making him and his billionaire friends more rich, that’s what he means by MAGA.
We were/are in an everything bubble after 0% rates and QE up the ass. Blaming this or that is silly. Had to pop.
How lovely. That didn’t take long. Trillions fresh inflation instant injection from fed yesterday being cashed out today. They are supposed to go slower to make it look better, but FOMO wins again. Greed is awesome.
Insiders always know ahead of time and most make a fortune on the trades. In fact, hasn’t the SEC been primarily dismantled? With no ‘cops’ on the beat, one can only imagine what is going on behind the scenes.
The riverboat gamblers are poised to take down the house. I think Trump’s fans who are honest and hardworking and respectable and well-intentioned and decent will be shocked when they get rug-pulled.
Insiders can trade on individual securities. Market indices, not really. Not of this magnitude.
One can imagine the exact scenario that is playing out, without much exercise for one’s brain functions.
Specialists always cover the gap.