🗞 Bulls at The Rig

WHILE YOU POUR THE JOE… ☕️
King For a Day

On our previous newsletter, we pointed out some of the key levels we wanted to trade on the S&P 500 futures, and they all played out today. 🎯 

That puts us at 300+ points given to start the first week of April (counting Monday), and for those smaller traders out there, that’s 300 × 5 = $1,500 on a single contract of the Micro E-mini futures.

Where we get these ideas is exactly the kind of stuff we cover inside our mentorship program, which only those with big enough accounts (and guts) get to apply for. ⬇️ 

The Sovereign Trader Program: 5 No-Sweat Tools Taken From Goldman Sachs.

Anyways, this week has a lot of data coming out not to mention Trump’s Liberation Day, so buckle up for some further whipsaws.

Speaking of ideas, let’s get on with today’s email 📧…

SQAWK BOX
Blueprints Out

This is the manufacturing PMI index, and if you’ve been with us for a while, you know that the PMIs are the reports that give us about 85% of our trade ideas every single month.

That being said, there are a few things I want to run by you first, and it is the impact that tariffs are having on the index readings today:

• Businesses are readying for the potential tariff impact left and right, which might be skewing readings a bit.

• You will see that bottlenecks are forming, while the underlying readings all point to a seeming recession for the economy.

• There is one industry we are still very bullish on today. 👀 

Here’s a snippet from The Sovereign Trader Program on the PMI, to save me from re-writing the whole thing:

Okay so knowing that the PMIs typically give us a direct insight into GDP, and therefore the S&P 500, here’s what we noticed:

• New Order readings collapsed over the month.

• Production contracted (again).

• Prices spiked (again).

It doesn’t take an economics major to know that there is no new demand, and that is because the market is now seeing liquidity dry up, which we wrote about in this newsletter right here. 🎯 

Therefore, prices for manufacturing industries spiked, led mainly by metals and electronics, since these are the most susceptible to tariff bottlenecks.

But those won’t be the focus of our long ideas today, rather, we want to look into a hidden gem, an underwater volleyball so to speak.

The qualitative side of the PMI, which corroborates the expansions we’re seeing in the oil industry at the moment.

Out of all the contractions seen in the manufacturing sector, oil has been expanding its new orders for a consecutive quarter now, and we believe prices are about to soar.

Believing that China’s comeback can play a major role in oil demand will pay dividends, as it seems, and executives in the industry are now making it clear that this is the path forward, as seen in those comments above. ✅ 

So, if you knew that an industry was reporting higher demand for three consecutive months, wouldn’t that lead you to think that earnings announcements for companies in this space would also have to come in higher? 📈 

If that’s on your mind, then you’re right.

Here’s our top pick in the industry for a buy. ✅ 

TRADE OF THE WEEK
Made in Upside

NIO stock, that’s our pick. 🚗 

Remember how we said China is going to grab the stock market by the horns this year? That post about stock market to GDP ratios and all.

Well, we just got BYD deliveries this week, and they were much higher than Tesla’s, but then they are arguably a much better car and are tapped into many other markets as well.

My point is this. ⬇️ 

NIO doesn’t have to beat the giants, it just has to fulfill on revenue expectations during the Chinese economic craze and it will be fine.

And trust me, there’s a reason why analysts expect to see 55.4% EPS growth for 2026, and why markets are paying a premium 9.6x P/S for it today.

On a market profile basis, it looks like we’re sitting on a low-volume node area for the year so far, but it also happens to be a liquidity pocket for 2024.

All told, I think this has the potential to first rally back to $4.5 ish to see who the real players are, and if those are buyers, then we might as well see $6 again, which would be a near 100% upside from today. 🔥 

Now imagine you were playing options…

Anyway, at 50% of its 52-week high, this seems like a great risk/reward play for you to look over especially if you believe the China hype.

There’s a reason why the $MCHI and $BABA have outperformed the $SPY over the past quarter, rotations are happening. 📈 

First to the blue chips, then to the more speculative ones, where NIO comes into play. And look, our friends on Wall Street agree with us so far. 🫰 

GO AND MAKE IT HAPPEN
Know Your Friends

I was skeptical about China for the longest time, but then I opened my mind to the idea of studying the freaking country.

Turns out, they’re pretty much 10 years ahead of us in every aspect but militarily. Today’s book recommendation 📖 will reiterate the ways the Chinese like to do things, which is quietly and thinking 50 years ahead.

After reading it, you’ll want to get yourself some Alibaba stock.

To your success,

G. 🥃