Trump's New Tariffs Just Changed Everything!

We have to talk about this because, again, it's such a beautiful setup if it actually forms. I want to remind you, again, markets are more bullish than they are bearish. Markets are definitely safer when you go long. With that being said, there's an overbought reversal that is currently forming that I find personally very attractive. Again, if you're a beginner, do not copy this, right? This is a high-risk trade as it is shorting against the current overall market direction and sentiment. So, first off, the Nasdaq market is trading a lot higher today. You'd be surprised to find out that there actually isn't that good of news, right? If you actually pay attention to what's going on right now. First off, uh we need to talk about this. Korean exchange activates a buy-side sidecar halting programs buying for 5 minutes after KOSPI surges 5%. This makes sense, right? This, just like when the South Korean markets were dropping and aggressively crashing overnight, they acted as negative catalyst for the semiconductor space and the overall Nasdaq market. So, I like when things make sense, and that's what we talked about in today's live trading session where we were really trying to figure out, "Hey, what's propping markets higher?" Because a lot of these mag seven stocks were not in the green. And when you heard the news that, I mean, we're going to get into it in just a little bit, but the idea that oh, oil prices are surging to $85 a barrel after Iran says that it has struck an Amazon data center. That doesn't sound bullish. Oh, wait, maybe it's that President Trump is preparing new round of tariffs up to 60 countries at the current 10% global level. I mean, that doesn't sound bullish. Again, a bunch of dozen countries um or over a dozen countries 10% tariffs, and then this is the breakdown of of um what they're going to consist of. Like, none of that sounded bullish, but yet semiconductors were incredibly bullish. So, in today's live trading session, we're like, "Hey, we need to find this news. We need to find the catalyst." The first thing is this is the thing that makes the most sense. South Korean markets are propping itself up higher. The KOSPI has been a huge indicator for the semiconductor in the chip space. I love that. Like, just like they have every reason to when they drop that semiconductors and memory chip stocks drop, they have every reason that when they rally, then they should rally as well. I like that makes complete sense. I don't like it when it doesn't make sense, right? If that wasn't an indicator or actual news, then it would have not made any sense on why any of these, you know, memory chip or semiconductor stocks were trading higher. But, then you come to find out that another driver for this news is that, uh let me pull it up here. Micron Technology is rising over 10% as Bank of America adds it to the list of best investment ideas. What? That is what's propping the stock up even higher? Like, to me that's Who cares what Bank like, of course Bank of America is going to add that to the list when all they've been doing is adding more of that position to their long-term plays. It's like that to me is just hype. Now, don't get me wrong. If you look at Micron, I've said it before, it's one of my favorite memory chip companies that is trading at a very low P ratio. But, market sentiment has been quite weak recently. It was oversold, right? We talked about this major support range that it's been testing. With things escalating in the Middle East, we have big earnings coming up tomorrow, Wednesday, and Thursday, right? We talked about that. We have Tesla and Alphabet reporting tomorrow, ServiceNow, IBM reporting tomorrow, and then Intel reporting on Thursday after the markets close. That should be really interesting, right? And that can act as a further either positive or negative catalyst depending if it exceeds market expectation. But the thing that you cannot lie to yourself about is that there there is hype being factored in right now. There there is no break of structure, no break of pattern, and this thing continues to run higher off of what? Just momentum. That's all it's become as of right now. It's a momentum play that currently direction and sentiment is in its favor. But as we've seen, right? There's a reason that this stock is down 30% from the highs of 1,300 to the lows of when it was at what was at $800 per share. It lost a significant amount because again, it does great when momentum is in its favor, but when it loses momentum, then it quickly begins to give it all back. So, I would just proceed with caution at these elevated levels knowing that it's up 12, 13, maybe even 14% by the end of as it gets closer to the end of the day, ask yourself what is your intention. If you're into it as an investment, then great. I love that because it actually does make sense when you look at Micron Technologies as a possible investment, you know, you look at the P ratios, you look at the upside potential. It trades at a very low P ratio. It's a great company revenue-wise. Net income is absolutely beautiful. And when you look at the actual fundamentals and how it's growing, that makes complete sense. But if you're just jumping in now when it's up 12 or 13% and you only expect it to go up and your intention is not to invest in it, but to trade it, I would be careful because again, it's a momentum play right now. If you're investing into it, then you don't really care that it's up 12% today cuz again, it could be down 6% tomorrow. But your timeline is you're not into it just for a few days or a few weeks or even a few months. You're into it for a long-term investment, maybe years from now, right? At least that's normally what an investment is. So, I'm just here to remind you to make sure that the positions that you are taking are aligning with your intentions. There's nothing wrong. It makes complete sense on why you're going long on MU. But, I hope that you understand why it's pushing up today. And I hope that you don't over celebrate today because it's green and then feel really bad for yourself tomorrow if it's red. Remember, only you can decide what your intentions are. Are you into it for a trade? Or are you into it for a long-term investment? And then again, knowing that it's up so much for such irrelevant news, I should I think that it should just prepare you mentally for a potential correction, for a potential downturn. And okay, if it does drop 5% can I tolerate it? And if not, then maybe you do something about your position size, right? With that being said, I wanted to quickly highlight this. President Trump is preparing to announce 10% tariffs on dozens of countries this week. These new tariffs as President Trump's current 10% tariffs expire later this week. President Trump advisers have reportedly warned him against doing so. Advisers are reportedly worried about risking the economic shock um of the original trade war. This was from last year ahead of the midterm elections. He's already doing terrible for the Republicans when it comes down to that. It's very unfortunate news, but it is what it is. The Trump admin is also working on other investigations that could grant it the legal authority to propose higher tariffs. More tariffs are on the way. And again, the big uncertainty with that is when more tariffs get injected into the market, higher prices, more uncertainty, markets begin to drop to uh according to that. At least that's how they've reacted in the past before. But again, markets are incredibly irrational. They want to do whatever it is that they feel like they need to do. Just please, please, please, please be very, very careful at extreme overbought and oversold levels. Just like we talked about it yesterday that hey, markets are technically oversold. They could just dead cat bounce for whatever the reason might be. Today's a great example of that. Be careful shorting. Same thing with today. A lot of these semiconductor and memory chip stocks are up 12%. It's not that they can't push up higher. It's that they gapped up so much in such a short period of time. You maybe just want to proceed with caution. Don't use leverage and don't bite down more than you can chew. Because again, it's great today, but who's to say that they can't give back half if not all of what it gained by the end of the week. Remember, big week ahead. We have Tesla, Alphabet, ServiceNow, IBM, and Intel all reporting earnings this week and we plan to live stream all of it on the channel. Again, these are all concepts that we talked about in our live trading session today and we killed it. If you guys didn't tune in into our live trading session this morning with the LPP team, I would encourage you to go back and watch it. We took both sides trades when it came down to Micron and it just it was beautiful. So, if you guys didn't already watch it, go back and watch today's live session. If you're not yet part of the team, second link in the description down below. You can sign up today and start watching me trade live as soon as tomorrow. But you can also rewatch today's live session if you have the time as we always store every previous live session for you. Again, if you want to join LPP, but you want to watch one of these live sessions before you join, we love that. Watch a real session. You guys can just click here and get a taste of what the LPP team experiences before you actually join. So again, I appreciate you guys' time. I hope that we're going to thumbs up. Don't forget to subscribe and like always, let's make sure that we end the year on a green note. Take care team and happy Tuesday.