Proflex Market Update - Wk 17

Markets continue to struggle as a week of high-stakes trade negotiations yielded no tangible progress. Hopes for a swift resolution are fading, and the uncertainty around pending tariffs on pharmaceuticals, electronics, and semiconductors is weighing heavily on sentiment.

Adding fuel to the fire, Trump’s ban on NVIDIA’s H20 chips to China further confirmed that the administration is doubling down on strategic decoupling rather than loosening restrictions. This is being interpreted by investors as a signal that U.S. equities—particularly in semiconductors—could be collateral damage in the ongoing trade war.

Economic Indicators Flashing Concern​
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April has seen growing anecdotal evidence of trade slowdown fallout:

• Blank shipping containers skipping calls at ports
• Trucking layoffs increasing as freight volumes shrink
• Weak inventory replenishment trends from retailers

These developments suggest that front-running of tariffs in Q1 is now reversing, with April shaping up as a soft patch for U.S. trade activity. Markets are growing cautious that a prolonged tariff war could bleed into broader economic weakness.

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Political Volatility Adding to Market Stress​
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President Trump’s public criticism of Fed Chair Jerome Powell continues to rattle bond markets. The optics of this pressure are problematic—if the Fed cuts rates now, it may be seen as a politically driven move, which could compromise its credibility.

At the same time, bond yields are drifting higher, which tightens financial conditions and further pressures equities. It’s a lose-lose setup unless there’s clear, data-driven rationale for monetary easing. Trump needs to back down here as he is simply sabotaging the markets with this approach.

Safe Haven Assets Shine Bright​
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Amid all this chaos, safe havens are in clear uptrend:

• Gold continues to surge, now trading above $3,400, setting new all-time highs almost daily

• Bitcoin has broken out of its recent downtrend, showing positive divergence from equity markets and reclaiming psychological levels above $88K

• The dollar is weakening, adding tailwinds to both gold and BTC as alternative stores of value

We’re seeing a classic risk-off rotation—and as we’ve advised in recent weeks, our gold and bitcoin allocations are playing their defensive role perfectly.

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What Now? – Navigating This Crossroad

We discussed in last week’s Proflex Macro Call how the 4,800 level on the S&P 500 represents a strong technical support zone. We bounced off that earlier this month, and barring a complete geopolitical meltdown, we do not expect a sustained break below that level.

However, to mount a recovery, the market needs:

• Concrete progress on trade negotiations, especially with China
• Visible policy action on tax cuts (promised, but still not materialized)
• Stability in long-term bond yields, which continue to drift upward

Until then, markets are in wait-and-watch mode, searching for positive catalysts to counterbalance the current negative flow of headlines.

What We’re Watching This Week:

• Yen price moves, particularly around U.S.-Japan trade deal terms and reactions to carry trade
• Any movement on the Republican tax plan—this remains key for sentiment
• Follow-through price action in gold and bitcoin—confirmation of their safe haven leadership
• Earnings updates from key industrial and tech names that can move sentiment

📢 Join the Discussion in Our Macro WhatsApp Group!​
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Proflex Subscribers – Staying Ahead of the Curve 📈

Separating Noise from Signal: In volatile markets, we help subscribers stay disciplined and focus on strategic long-term opportunities.

Best regards,

Raman Bindlish

Editor-in-Chief,

Proflex Finance

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