April 22nd MTR Subscriber Data Tracker Updates -Bulls Back in Biz -Trump Folds?

Well stocks are ripping higher on news that the Trump administration will soon cave and reduce the tariffs on China:

The administration was open to reducing the 145% tariffs imposed on Chinese goods, indicating they “will come down,” but adding, “it won’t be zero.” -DJT per WSJ

On another note and what seems to be infuriating some of the masses was the fact that Treasury Secretary Scott Bessent held a closed-door meeting of investors, where news was allegedly relayed, “that the ongoing standoff with China was unsustainable and that he expects the situation to de-escalate soon.”

No wonder the markets spiked yesterday and are continuing this move, look there will always be people on the inside that know first, this is just a common and well known attribute, Magnelibra doesn’t really care that these connected insiders know first. We just accept this fact and can only react to what the market is doing at one particular moment in time. So try not to get caught up in the fact that Trump insiders are leaking this or that, honestly everything is divulged in the pricing eventually and for now, it seems everyone believes that the reduction in tariffs if they do end up transpiring is market bullish.

This seems to be the narrative to continue the push out of oversold and into what the bulls will inevitably try to mount is a renewed vigor for a bull case going forward. We doubt that will transpire, but the news and the market action are now trying to state this case and its something that is driving the buyers today. Don’t get us wrong this volatility could just as easily flip back down, but today, bulls seem to hold the cards!

The narrative today has been set by Bessent’s closed door comments and the WSJ reporting that,

The White House is considering a significant reduction in tariffs on Chinese imports, potentially cutting them by more than half in an effort to ease trade tensions with Beijing. Individuals familiar with the discussions told the Wall Street Journal (WSJ) that tariffs could be lowered to between 50% and 65%, though no final decision has been made. -WSJ

Alright, let’s hit up the technical charts, first up Bitcoin, the bulls on the heels of fresh StrategyB BTC purchases have pushed Bitcoin back above $87,500 a good sign that the bull move is trying to reassert itself and this number now becomes support on the downside. The upside is capped at $95,000 which is the down slope created from the same angle as the last major bear market:

If risk is indeed coming down then the narrative should also mean that US Treasury yields will move back lower and thus once again, the US Govt 10Y is now back below our 4.37% line in the sand:

Looking at the June SP500 futures we continue to target the 5525 level as our resistance point on the weekly chart:

Next up the Nasdaq futures, 19k was big last week and 19100 will be key resistance again this week with 18350 now the weekly support with 17650 below there the support area, but the trend will flip neutral with today’s move and could lead to further upside probes:

Alright so on the earnings front, yesterday saw Tesla (TSLA) and Intuitive Surgical (ISRG), Tesla was higher off earnings, which weren’t great and Intuitive was pounded in the after hours dropping about 7% but recovered by today’s open. Tesla’s profit dropped 71% in the first three months of the year and earned $409m vs $1.4Bn in Q12024, so numbers atrocious but stock was oversold and thus the rally as Tesla is trading $258 today up over $20 and 8.6% on the day! ISRG was hammered post close yesterday to the $440 area but has recovered trading $502 today +$23 or 4.8%.

As far as today, we are looking at ServiceNow (NOW) and Chipotle (CMG. Lets take a look at the breakeven via the option straddles.

ServiceNow is down about 40% off the highs, so for the analysis lets use the 815 strike, is priced at $61.00 which implies a 7.5% move. Looking at the charts technically this is leaning to the short side here with the recent rebound and the Friday expiry $790/$760 put spread is trading $10. So risk $10 to make $25, this is a 2.5x risk/reward profile, here is the chart of (NOW):

Magnelibra is bearish ServiceNow and can sight multiple reasons for this, valuation concerns (120xPE), slower future growth as YoY growth has been trending lower over the last 3 years, competition from MSFT and CRM as well as Macroeconomic conditions lead to spending cuts on IT and a growing short interest base ultimately targeting a new low at $650.

As far as Chipotle we are leaning to a more hold here and possible price bounce. Technically it seems well supported, pricing power remains and margins are up slightly. Their expansion plans seem to be on pace for about 8 to 9% unit growth and a 44x PE is down about 40% from 2023 levels. Equity does seem to be oversold and we expect it to work off those conditions.

As far as the options breakeven straddle pricing with this Friday as the expiration, we will use the $48 strike. Its priced at $3.90 indicating a chunky 8.1% move. The $49/52 call spread is trading around $1.15 for a 2.6x risk/reward. There is some decent size in the $47 put as well so should be interesting below there.

Ok that is it for now, we have all the MTR Subscriber data and trackers up next, we urge you to become a full subscriber and truly break through that barrier of understanding in regards to our global financial system.

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