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10 Things You Need to Know – Not Winning Bigly Edition!

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What a week! We just saw:

  • A gigantic surge in stocks in May
  • The US-EU trade relations get better
  • The US-China tariff situation turn into a big fat mess all over again
  • Nvidia (NVDA) beat earnings estimates… and then flop like a dead chicken
  • Inflation continue to trend lower

And a whole lot more! So let's dig into the 10 Things You Need to Know About Markets Right Now.

1. President Trump Is Not Winning Bigly… For Now

President Trump had another big week.

On Tuesday, the market felt warm & fuzzy feelings after he issued a tariff delay to the EU.

Then on Wednesday, a federal court said Trump overstepped his authority by using emergency powers to slap tariffs on foreign countries.

And on Friday, the President accused China of violating the recent Geneva trade deal, sending stocks lower.

So while he was “winning bigly” in recent weeks, things are getting messy.

Of course, God only knows what news will hit this weekend.

So buckle up buttercups!

BTW, down below, we update you on the “Ultimate Trump Trade” so keep reading.

2. We've Come a Long, Long Way

Markets were clearly troubled by Friday's China news, but let's not get carried away.

But we've come a long, long way from the April post-Liberation day lows.

SPY is up over 21% since then:

And QQQ is up almost 30%.

Maybe the market was just waiting for a catalyst before it took a break.

But again… anything can happen come Monday.

3. Nvidia Was Good But Not Good Enough

On Wednesday, Nvidia beat earnings expectations for the 10th straight quarter.

And when we look at the long run, the company's growth has been shocking:

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But Nvidia's guidance was weak thanks to US trade restrictions on China.

So as of Friday afternoon, the stock gave up all its post-earnings gains:

4. The Mood Is Slightly Sour

The latest AAII Sentiment Survey shows that 32.9% of investors are bullish.

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This is down from last week's 37.7% reading, and it's below the long-term average of 37.5%.

Still, this reading is much improved from the March-April lows, when everyone was losing their minds over tariff fears.

5. Could Lower Inflation Be Bad?

The PCE Price Index was a lower-than-expected 2.1% in April to extend the downtrend from post-pandemic highs:

This follows light CPI and PPI prints.

But let's ask a question no one's thinking about.

What if lower inflation is a bad thing?

What if it means economic demand is sagging?

And what if it means the Fed is behind the curve and moving too slow?

Since I got a B- in macroeconomics, I won't pretend I know what's going to happen.

But I am a little worried.

6. Whose House? HIMS House!

Hims & Hers (HIMS) a.k.a. the Netflix of primal needs and desires, shot up on Friday out of nowhere.

Why?

One theory being floated is that the company will be added to the S&P 500.

We also caught this announcement from Jonathan Stern's “Hims House” X account, announcing “we've raised our Q2 revenue prediction.”

If you're following the HIMS story (I'm long myself), follow this account.

And oh yeah, don't forget HIMS has 27.8% short interest.

According to KoyFin, that makes it the most shorted stock in the S&P Midcap 400 ETF (MDY):

7.  Ultimate Trump Trade Update

The President is a mean, lean, orange, volatility-generating machine.

So what is the real Trump Trade?

These 4 stocks, which have crushed the major indices:

  • Robinhood (HOOD): +157% since the election
  • Interactive Brokers (IBKR): +34%
  • Coinbase (COIN): +27%
  • Charles Schwab (SCHW): +24%

So long as Trump can shake the table without breaking it, trading volumes should stay on the rise.

On May 1, Interactive Brokers said Daily Average Revenue Trades (DARTs) were up 63% YoY in April.

And May was pretty wild too!

8. Biotech Is So Ugly, This Chart Might Scare Your Kids

Just when you thought it was safe to sniff around the biotech sector, Regeneron (REGN) and Sanofi (SNY) get slapped on negative trial data.

But could this sector actually bottom at some point?

Look at this 10-year chart of SPY vs. XBI:

SPY is up 230%.

And XBI is up 1%.

Doesn't get uglier than that.

Traders have been burned for years buying biotech dips.

That has to change at some point. Right?

9. You Can Learn to Trade Like Jesse Livermore

Jesse Livermore is one of the greatest traders of all time.

And Sami Abusaad will teach you the #1 trading secret from Livermore's 100-year old book “Reminiscences of a Stock Operator.”

10. 2 Dark Omens for Bitcoin?

Bitcoin went on a tear off the April lows, rewarding the faithful with a huge run.

But it's been slipping since the May 22 peak at $112,000.

And interestingly – sector favorite MicroStrategy (MSTR) has been dropping like a rock.

Plus on May 28, video-game retailer GameStop (GME) announced it bought 4,710 Bitcoin.

And what happened? A big fat sell-the-news:

Bitcoin might need a nap to recharge.

Have a great weekend folks.

ATTN: Serious Options Traders

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