Pivot Point Capital
Closed $LULU short @ $245.5, $NKE short @ $57.65 I think these stocks have fallen enough and may see squeezes. Also think VN will be one of the first to nego a trade deal given how impt U.S. imports are to them. And that Trump doesn’t actually want low-margin…
Some outcomes of this game can be logically deciphered, putting us one step ahead of the market — like with VN Problem now is how does VN cave even if they want to, as explained above?
Others, like China, are edge risk cases — hence why we exited $BABA too.
I think US tech mega caps are especially vulnerable (see China rare mineral export restrictions yesterday), given their global supply chain dependence and also because they’d prob be the first few targets of retaliation given the significant concentration of US wealth there. Hence the shorts on $AAPL and $TSLA (we covered, but just explaining the rationale)
Others, like China, are edge risk cases — hence why we exited $BABA too.
I think US tech mega caps are especially vulnerable (see China rare mineral export restrictions yesterday), given their global supply chain dependence and also because they’d prob be the first few targets of retaliation given the significant concentration of US wealth there. Hence the shorts on $AAPL and $TSLA (we covered, but just explaining the rationale)
Preview for next week:
While we may see some mean reverting bounces driven by dip buyers next week, given that sentiments are pretty bad, I think for the most part, any rallies will not be sustainable and will be faded. The catalyst path forward for further downside includes Apr 9 and Q2 earnings.
I think a massive mispricing last week, amidst all the panic, was $DXY strength on Friday due to mass selling of risk assets into USD. If these tariffs hold, the USD’s reserve currency status, and thus value, is at risk.
USD as a reserve currency and large trade deficits go hand in hand. You can’t have one without the other. If manufacturing is indeed brought back to the U.S, and trade imbalance is restored, then there’s less need for countries to hold USD (and buy U.S. Treasuries), given lower trade with U.S. Without this artificial foreign demand for USD and U.S. Treasuries, the U.S. govt can no longer recklessly spend domestically due to lowered ability to finance their borrowings.
TLDR: If Trump is indeed trying to unwind this “normal” world order of an imperial tribute system of the world offering America cheap imports and borrowings while allowing her to essentially export inflation — the order that we have known since the 1970s, then the US economy is in for a lot more pain than is being currently priced in. It feels like the market is only pricing in temporary tremors, but if Trump is true about his stated intentions, it should be more like a structural tectonic clash.
While we may see some mean reverting bounces driven by dip buyers next week, given that sentiments are pretty bad, I think for the most part, any rallies will not be sustainable and will be faded. The catalyst path forward for further downside includes Apr 9 and Q2 earnings.
I think a massive mispricing last week, amidst all the panic, was $DXY strength on Friday due to mass selling of risk assets into USD. If these tariffs hold, the USD’s reserve currency status, and thus value, is at risk.
USD as a reserve currency and large trade deficits go hand in hand. You can’t have one without the other. If manufacturing is indeed brought back to the U.S, and trade imbalance is restored, then there’s less need for countries to hold USD (and buy U.S. Treasuries), given lower trade with U.S. Without this artificial foreign demand for USD and U.S. Treasuries, the U.S. govt can no longer recklessly spend domestically due to lowered ability to finance their borrowings.
TLDR: If Trump is indeed trying to unwind this “normal” world order of an imperial tribute system of the world offering America cheap imports and borrowings while allowing her to essentially export inflation — the order that we have known since the 1970s, then the US economy is in for a lot more pain than is being currently priced in. It feels like the market is only pricing in temporary tremors, but if Trump is true about his stated intentions, it should be more like a structural tectonic clash.
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Trump doubling down. Also impt to note that this has been Trump’s view for >40 years (NYT 1987)
JP Nikkei -8.5%, SK Kospi -5%, SPX -4%. Circuit breakers everywhere
Let’s see if nerves calm going deeper into the day
JP Nikkei -8.5%, SK Kospi -5%, SPX -4%. Circuit breakers everywhere
Let’s see if nerves calm going deeper into the day
Ackman (The General), one of Trump’s aristocratic supporters, crashing out on the TL — after being very vocal about his support for Trump for months — is actually pretty funny.
More importantly, it may mark a ST sentiment bottom. May try knife-catching a little later, let’s see.
Though maybe Chamath crashing out will be the true bottom signal.
More importantly, it may mark a ST sentiment bottom. May try knife-catching a little later, let’s see.
Though maybe Chamath crashing out will be the true bottom signal.
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Pivot Point Capital
Someone I have lots of respect for wrote about the winner’s and loser’s game today. I think there’s a lot of resemblance to the markets today, and life in general. In short, a winner’s game is a game where you have to do more, perform at your best to win…
Still my predominant view; US equity as a loser’s game.
All of the uncertainties now are opportunities in future, as one day they will resolve into certainty; thus presenting a catalyst path for longs again. Survive to be there
All of the uncertainties now are opportunities in future, as one day they will resolve into certainty; thus presenting a catalyst path for longs again. Survive to be there
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Pivot Point Capital
Closed all equity shorts and longs and going long into gold ($GLD). Was contemplating between long duration bonds ($TLT) or $GLD, but ultimately decided $GLD as $TLT carries FX risk w $USD, which typically deteriorates in trade tensions. Also in trade wars…
Knife-catching some $NVDA @ $88.57, $HOOD @ $31.36
More of a mean reversion play. Mostly $NVDA as I think this is pretty oversold, and is liquid for easy entry/exit.
Will cut quickly if goes wrong, may cut before Apr 9 if goes right.
More of a mean reversion play. Mostly $NVDA as I think this is pretty oversold, and is liquid for easy entry/exit.
Will cut quickly if goes wrong, may cut before Apr 9 if goes right.
Pivot Point Capital
Knife-catching some $NVDA @ $88.57, $HOOD @ $31.36 More of a mean reversion play. Mostly $NVDA as I think this is pretty oversold, and is liquid for easy entry/exit. Will cut quickly if goes wrong, may cut before Apr 9 if goes right.
Exited $NVDA @ $91.07, $HOOD @ $32.33 for 3%
It ain’t much but it’s honest work. Back to the sidelines for US open. Still in $GLD as main position
It ain’t much but it’s honest work. Back to the sidelines for US open. Still in $GLD as main position
Pivot Point Capital
Closed all equity shorts and longs and going long into gold ($GLD). Was contemplating between long duration bonds ($TLT) or $GLD, but ultimately decided $GLD as $TLT carries FX risk w $USD, which typically deteriorates in trade tensions. Also in trade wars…
On-and-off talks are why shorts are so hard to play now, even w a bearish view.
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Pivot Point Capital
On-and-off talks are why shorts are so hard to play now, even w a bearish view.
Possibly a fake headline
Futures ripping currently, climbing a wall of worry. Seems retail-friendly stocks like $PLTR are performing the best, might be indicative of flows.
Urging caution before Apr 9. Trump has mentioned an additional 50% tariff on China unless they withdraw their retaliatory tariffs. And what’s worrying is that the market has a history of not believing Trump’s words till the “panic” moment in the recent few months. Market has recently always been in the “nothing ever happens” mindset, right up till the moment it happens.
Not sure why Trump did it this way but he has effectively boxed himself in. Having issued this warning to China pushes both sides to a confrontation. China has stated that they’ll fight till the end. Ball is in Trump’s court now — either he backs down now as the boy who cried wolf or he has to issue an additional 50% tariff on China tmr.
Maybe they reach an agreement tn/tmr, who knows. But it’s never too late to join the “nothing ever happens” camp tmr instead of today. Just my 2cs
Urging caution before Apr 9. Trump has mentioned an additional 50% tariff on China unless they withdraw their retaliatory tariffs. And what’s worrying is that the market has a history of not believing Trump’s words till the “panic” moment in the recent few months. Market has recently always been in the “nothing ever happens” mindset, right up till the moment it happens.
Not sure why Trump did it this way but he has effectively boxed himself in. Having issued this warning to China pushes both sides to a confrontation. China has stated that they’ll fight till the end. Ball is in Trump’s court now — either he backs down now as the boy who cried wolf or he has to issue an additional 50% tariff on China tmr.
Maybe they reach an agreement tn/tmr, who knows. But it’s never too late to join the “nothing ever happens” camp tmr instead of today. Just my 2cs
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Pivot Point Capital
Futures ripping currently, climbing a wall of worry. Seems retail-friendly stocks like $PLTR are performing the best, might be indicative of flows. Urging caution before Apr 9. Trump has mentioned an additional 50% tariff on China unless they withdraw their…
Indices closed red after gaining ~4% in early session.
Fading market’s disbelief of trump’s actions has been such an incredulous source of alpha.
Shorted in small size $AAPL @ $170.75, $PYPL @ $56.58, $V @ $304.98, $NKE @ $52.67 for the continuation of a recession play.
Fading market’s disbelief of trump’s actions has been such an incredulous source of alpha.
Shorted in small size $AAPL @ $170.75, $PYPL @ $56.58, $V @ $304.98, $NKE @ $52.67 for the continuation of a recession play.
Pivot Point Capital
Closed all equity shorts and longs and going long into gold ($GLD). Was contemplating between long duration bonds ($TLT) or $GLD, but ultimately decided $GLD as $TLT carries FX risk w $USD, which typically deteriorates in trade tensions. Also in trade wars…
US bond yields also now higher than Liberation Day. Think we were right to fade the consensus take on seeking safety in $TLT post L.D.
Key headwinds for US bonds imo are 1) foreign countries dumping treasuries/reduced buying pressure from foreign countries if global trade slows & 2) higher supply-driven inflation from tariffs holding back Fed from cutting, even when at the expense of growth
Key headwinds for US bonds imo are 1) foreign countries dumping treasuries/reduced buying pressure from foreign countries if global trade slows & 2) higher supply-driven inflation from tariffs holding back Fed from cutting, even when at the expense of growth
Yuan has also started weakening - not sure if natural market forces or deliberate weakening by PBOC. Leaning towards the latter as a counter to US tariffs as weaker yuan reduces cost of China exports. Might be seen as an escalation on China side by Trump.
Reinforces my conviction in $GLD; 1) if global trade is being entirely reoriented w escalation of trade war, alternative forms of reserves from USD will be explored and required, and 2) CNY weakening may also cause capital flight into $GLD.
On 2), will also go long some $SGD.CNH FX pair in the AM
I’m never a macro guy (forced to by the climate), just learning on the go. Some of my macro takes may and will be wrong -- feel free to give feedback!
Reinforces my conviction in $GLD; 1) if global trade is being entirely reoriented w escalation of trade war, alternative forms of reserves from USD will be explored and required, and 2) CNY weakening may also cause capital flight into $GLD.
On 2), will also go long some $SGD.CNH FX pair in the AM
I’m never a macro guy (forced to by the climate), just learning on the go. Some of my macro takes may and will be wrong -- feel free to give feedback!
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Long $1810.HK @ $39.21 as a hedge to the rest of our positions which are exposed to the worsening of the trade war/recession. Given that most of Xiaomi’s sales are from ex-US, and also a significant portion from ex-China, I think the yuan weakening (intl) + stimulus (domestic) + affordable quality everything company <> China slowdown (domestic) could end up being a net benefit to the company.
Riskier trade obv so just a small starting position for now.
Riskier trade obv so just a small starting position for now.
Pivot Point Capital
Bessent, bond salesman of the Greatest Country on Earth, has fallen
Would hate to be Powell right now. Hands are tied w a 6-inch rope. Think he has to speak soon to address this — potential upside risk to shorts so trim if you have to.
6 hours since the 104% tariffs went into effect… eerily quiet on the China front except for this paper w 6 relevant words “resolving disputes through dialogue and consultation”.
Feels to me like giving Trump a 后路 to 下台. Can see potential removal of 50% tariffs + potential Fed intervention speech tonight; so leaning more ST bullish
Long $NVDA @ $98.7 & $HOOD @$34.3
Feels to me like giving Trump a 后路 to 下台. Can see potential removal of 50% tariffs + potential Fed intervention speech tonight; so leaning more ST bullish
Long $NVDA @ $98.7 & $HOOD @$34.3
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Pivot Point Capital
6 hours since the 104% tariffs went into effect… eerily quiet on the China front except for this paper w 6 relevant words “resolving disputes through dialogue and consultation”. Feels to me like giving Trump a 后路 to 下台. Can see potential removal of 50% tariffs…
Ok scrap those longs, luck of the draw