A sigh of relief as inflation cooled more than expected, lifting the S&P 500 (+0.5%) and Nasdaq (+1.2%). Big Tech took the lead, with Tesla (+7.6%) and Nvidia (+6.4%) rebounding sharply, but Apple (-1.8%) struggled.

While CPI helped ease Fed fears, trade tensions are heating up fast. Canada is hitting back with $20B in tariffs, and the EU is preparing its own counterpunch next month. Meanwhile, bond yields ticked up as investors recalibrated rate-cut expectations.

⚡ Closing Bell:
➝ Dow Jones: ⬇️ -0.2% › 41,350.9 › Weighed down by consumer staples.
➝ S&P 500: ⬆️ +0.5% › 5,599.3 › CPI relief fueled optimism.
➝ Nasdaq 100: ⬆️ +1.2% › 17,648.5 › Tech stocks led the way.
➝ Russell 2000: ⬆️ +0.4% › 2,088.3 › Small caps recovered slightly.

Economic Signals:
➝ Inflation Relief: CPI rose just 0.2% MoM, slowing to 2.8% YoY—cooler than expected.
➝ Tariff Tensions: Canada imposes 25% retaliatory duties on U.S. goods, EU follows in April.
➝ Rate Cut Bets: Lower inflation supports easing hopes, but the Fed isn’t in a rush.

Macro Moves:
➝ 10-Year Yield: ⬆️ +2.8 bps › 4.32%
➝ 2-Year Yield: ⬆️ +5.0 bps › 3.99%

❗ Looking Ahead: PPI data drops tomorrow, and markets are watching for more signs of cooling inflation. If producer prices stay tame, rate-cut hopes could stick around—but more trade war drama could shake things up again.

#TRUTH:
❗❗❗ “Inflation is when you pay fifteen dollars for the ten-dollar haircut you used to get for five.” ~ Sam Ewing

Gains & Pains:

➝ Tech Rebound: ⬆️ Nvidia (+6.46%) and Tesla (+7.68%) led the charge as investors jumped back into beaten-down AI and EV plays.

➝ AI Surge: ⬆️ Palantir (+7.21%) joined the rally, while Intel (+4.52%) popped on reports of a possible foundry sale.

➝ Energy Boom: ⬆️ Vistra (+6.62%) and GE Vernova (+5.05%) soared as the AI trade spilled over into infrastructure and power stocks.

➝ Retail Slump: ⬇️ Walmart (-2.60%) took a hit as its tariff strategy angered Chinese suppliers.

➝ Apple Sinks: ⬇️ Apple (-1.77%) struggled after Morgan Stanley cut iPhone sales forecasts, citing weak demand and AI delays.

➝ Turbulent Skies: ⬇️ United Airlines (-4.7%) took a nosedive as multiple banks slashed price targets on the stock.

➝ Crocs Climb: ⬆️ Crocs (+3.62%) jumped after a bullish upgrade, proving that ugly shoes still have a place in investors’ portfolios.

The Takeaway: AI and momentum stocks made a strong comeback, but tariff tensions and weak consumer sentiment are keeping markets on edge.

Rare Green Light:

A major technical signal just flashed “buy” on the S&P 500 for the first time in years.

The Relative Strength Index (RSI)—a momentum gauge that tracks how extreme price movements are—dropped below 30 on Monday and Tuesday, signaling oversold conditions. Now? It’s back above 30, triggering a classic RSI buy signal.

The last time this happened? October 30, 2023. Three months later, the S&P 500 had surged 16%.

Of course, history isn’t a guarantee—but in a market desperate for direction, traders just got a rare flashing green light.

₿ Stalling:

Bitcoin failed to sustain gains despite softer-than-expected U.S. inflation data, as escalating trade tensions kept risk appetite in check.

February’s Consumer Price Index (CPI) rose 2.8% YoY, slightly below expectations, while core CPI eased to 3.1%, raising hopes for Federal Reserve rate cuts. Traders now see a 31.4% chance of a May cut—up from just 9% last month—and are pricing in three to four cuts by year-end.

Bitcoin briefly touched $84,000 post-CPI but quickly retreated to $83,000, mirroring a broader market struggle. Analysts point to renewed U.S.-Canada trade friction ($21B in tariffs) and EU counter-tariffs ($28B on U.S. goods) as factors stoking inflation fears and uncertainty.

On-chain data suggests traders are losing confidence—crypto-wide trading volume has been declining since late February, with low conviction in price rebounds. Until buying momentum returns, Bitcoin remains vulnerable to further dips.

Outpaced:

Volkswagen’s big bet on Porsche’s IPO in 2022 hasn’t quite paid off, with shares stuck in neutral since going public. Meanwhile, Ferrari—unleashed from Fiat nearly a decade ago—has left its rival in the dust.

➝ Porsche’s Pit Stop: Shares of Porsche (-20% since IPO) are struggling, with flat sales, a 23% profit decline, and plans to cut 1,900 jobs.

➝ Ferrari’s Fast Lane: Ferrari (+760% since IPO) has kept investors hooked with controlled supercar releases, strong delivery figures, and a loyal customer base.

While Porsche tries to get back on track, Ferrari continues to lap the competition.

Optimism:

Crude prices held onto their biggest gain in two weeks, as easing U.S. inflation data gave risk assets a boost.

➝ Brent crude hovered near $71, while WTI stayed just below $68 after a 2% jump on Wednesday.
➝ U.S. consumer prices rose at their slowest pace in four months, fueling optimism that inflation may stay in check—though looming tariffs could push prices higher down the road.
➝ Supply concerns remain: OPEC production surged last month, while U.S. crude inventories rose for a second week—but less than expected.

The International Energy Agency’s Thursday report may offer more clues on the supply-demand balance, but for now, oil is getting a lift from improving sentiment.

Escapes:

Bamboo Forest Kyoto, Japan

Commodities Check : ✔️

• Gold: ⬆️ +0.7% › $2,940.30 per ounce
• Silver: ⬆️ +1.7% › $33.70 per ounce
• WTI Crude Oil: ⬆️ +2.1% › $67.64 per barrel

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Disclaimer

This letter is not offering investment, trading, or investment advice nor is based on any individual portfolio or business operation. We are not a registered investment, stock nor commodity advisor. One should consult with their own registered advisor to discuss investment strategies that are appropriate for their business or personal goals, risk tolerance and financial situation. Information in this report and on any website is derived from a variety of source believed to be reliable however no representation is made that the information is accurate, complete or correct. These lessons, newsletter and site content is not intended nor shall not constitute or be construed as an offer or recommendation to “buy”, “sell”, “trade” or invest in any securities, commodities, futures, options or other asset referred to in said lessons, reports or newsletters. Rather, this research is intended to identify situations and circumstances that those in the trading community should be aware of to better help assess and improve their own risk management skills.