WEEKLY STOCK MARKET DIGEST: WHAT PRUDENT INVESTORS NEED TO KNOW NOW

April 12, 2025

By Nigam Arora & Dr. Natasha Arora

Weekly Digest from The Arora Report is popular among serious investors and money managers because they have found studying insights from the prior week gives them an edge over the coming weeks. Here is the day by day rundown from the morning capsules made available every morning before the market open in the Real Time Feeds to the paying subscribers of The Arora Report.

Please scroll down for the section ‘Protection Bands and What To Do Now.’

FOREIGNERS DUMP THE DOLLAR, GOLD AND YEN ACT AS SAFE HAVEN, JPMORGAN HELPS STOCK MARKET, COOLER PPI

Apr 11, 2025

To gain an edge, this is what you need to know today.

Extraordinary Behavior

Please click here for a chart of the dollar index (DXY).

Note the following:

The chart also shows gold ETF (GLD), Japanese currency yen ETF (FXY), S&P 500 ETF (SPY), and JPMorgan (JPM).
The chart shows that the dollar index has fallen below the psychologically important level of 100.
Unlike stocks, the dollar normally does not move as much as it has recently as shown on the chart. This move in the dollar is extraordinary.
The chart shows the move in SPY when President Trump paused reciprocal tariffs. It was one of the strongest moves ever. U.S. investors loved the pausing of the tariffs.
The chart shows that as the dust settled, foreigners dumped the dollar and bought gold and yen. Yen ETF FXY and gold ETF GLD are in the ZYX Allocation Model Portfolios.
As a member of The Arora Report, you were ahead of the curve. We previously shared with you that foreigners were not only selling the dollar but also selling U.S. Treasuries. From yesterday’s Morning Capsule:

In the Arora Report analysis, the selling in the dollar and bonds appears to be coming from foreigners.

Normally in periods of stress, like now, foreigners buy the dollar and U.S. Treasuries. The behavior of foreigners this time is extraordinary. Prudent investors want to know why foreigners are behaving contrary to the way they have historically behaved.
Change has unintended consequences. Little did anyone know that when President Trump paused tariffs, foreigners would start dumping the dollar. Those who want next level information on the unintended consequences of change may consider reading the book titled “Theory ZYX of Successful Change Management: A Definitive Guide to Reach the Next Level” by Nigam Arora.
In The Arora Report analysis, there are two reasons why foreigners are dumping the dollar and U.S. Treasuries.
- The quick reversal on tariffs sent an unintended message to foreigners that the U.S. is unreliable.
- Irrespective of the public reasons given for the quick reversal, foreigners were not fooled. They quickly understood that the reason for the reversal was Treasury yields spiraling out of control. As a member of The Arora Report, you know that ahead of the curve. We previously wrote:

In The Arora Report analysis, the foregoing played a role, but the real reason for the tariff reversal was likely the rise in bond yields.

In The Arora Report analysis, the tariff reversal has now exposed President Trump’s pain threshold to foreign leaders. Foreign leaders will take advantage of this knowledge by taking a tougher stand in negotiations with the U.S. on trade.
In general, a weaker dollar helps the stock market because it helps earnings of multinationals. A majority of the companies in the S&P 500 are multinationals. Having said that, in The Arora Report analysis, concern is mounting about the dollar drop. The hallmark of a strong country is a strong currency. In The Arora Report analysis, those who are cheering the fall in the dollar, such as crypto promoters, are not thinking of the long term future of the U.S.
Overnight, stock futures were coming under pressure after yesterday’s reversal in SPY shown on the chart. Helping the stock market this morning are earnings from JPMorgan. Earnings from JPMorgan are better than the consensus and whisper numbers. JPM is long from $34.14 in the ZYX Buy Model Portfolio. JPM is trading at $231.39 as of this writing in the premarket. This represents a gain of 578% for long time members.
On the flip side, JPMorgan’s CEO Jamie Dimon is observing that geopolitics is causing turbulence.
China has increased tariffs on U.S. goods to 125% in response to President Trump raising tariffs on Chinese goods.
The just released Producer Price Index (PPI) shows inflation at the producer level falling. In The Arora Report analysis, this data is likely anomalous and driven by mechanics related to stockpiling of goods ahead of tariffs. Here are the details:
- Headline PPI came at -0.4% vs. 0.1% consensus.
- Core PPI came at -0.1% vs. 0.3% consensus.
University of Michigan consumer sentiment will be released at 10am ET and may be market moving.
As an actionable item, the sum total of the foregoing is in the protection band, which strikes the optimum balance between various crosscurrents. Please scroll down to see the protection band. The protection band is one of the large number of unique edges that are available to members of The Arora Report.
If foreigners continue to dump the dollar, as a heads up, the protection band will need to be raised. Consider buying new positions only with great moderation, unless there is a specific post. There is also too much risk in short selling – all President Trump has to do is send a tweet and the market can soar.
Prudent investors also need to keep in mind that the best opportunities occur during uncertain times. Long time members may remember The Arora Report’s signal on March 9, 2009 to back up the truck and buy stocks. That signal was given at the most uncertain time when Wall Street was giving sell signals. Hindsight shows that March 9, 2009 was the exact date when the decade long bull market started.
On April 8, 2025, when most analysts were claiming that a capitulation had occurred, The Arora Report shared with you that in our analysis a capitulation had not occurred. That call has now proven spot on. The stock market’s behavior since April 8 is crystal clear that those claiming capitulation had occurred were wrong. Those who want to understand capitulation may consider listening to the podcast titled “THE TEN SECRETS OF EPIC CAPITULATION RICHES.”
The worst mistake investors can make is to not stay engaged during this turbulent time. For example, many investors had become disengaged and did not follow The Arora Report’s signal to back up the truck and buy signal on March 9, 2009. Subsequent emails from such investors show that they regretted disengaging and missing out on one of the most profitable signals ever.

Magnificent Seven Money Flows

In the early trade, money flows are positive in Nvidia (NVDA), Microsoft (MSFT), and Alphabet (GOOG).

In the early trade, money flows are negative in Apple (AAPL), Amazon (AMZN), Meta (META), and Tesla (TSLA).

In the early trade, money flows are mixed in S&P 500 ETF (SPY) and Nasdaq 100 ETF (QQQ).

Momo Crowd And Smart Money In Stocks

The momo crowd is *** (To see the locked content, please take a 30 day free trial) stocks in the early trade. Smart money is inactive in the early trade.

Note for new members: Smart money often sells into the strength generated by momo crowd buying and buys into the weakness generated by momo crowd selling. Over a long period of time, investors come out ahead by adopting smart money’s ways. The exception is in a raging bull market – for very short term trades, consider following the momo crowd and not smart money. Smart money is an important indicator but is only one of hundreds of indicators that go into determining the protection band and signals. Please click here and here to understand how signals are generated.

Very Very Short-Term Indicator

Our very, very short-term early stock market indicator is ***. This indicator, with a great track record, is popular among long term investors to stay in tune with the market and among short term traders to independently undertake quick trades.

Thank you for letting us know that the very very short-term indicator is of immense help to you. Having said that, this indicator is indeterminable again today because the stock market will move based on rumors and news related to President Trump. It is impossible to predict such rumors or news.

Gold

The momo crowd is *** gold in the early trade. Smart money is *** gold in the early trade.

For longer-term, please see gold and silver ratings.

Oil

The momo crowd is *** in oil in the early trade. Smart money is *** in the early trade.

For longer-term, please see oil ratings.

Bitcoin

Bitcoin (BTC.USD) promoters are celebrating the fall in the dollar and urging their followers to buy bitcoin, giving the dollar’s fall as the reason.

Markets

Interest rates are ticking up, and bonds are ticking down.

The dollar is weaker.

Trading futures is not recommended for most investors. The purpose of providing this information is to give an indication of the premarket activity that usually guides the activity when the market opens.

S&P 500 futures are trading at 5283 as of this writing. S&P 500 futures resistance levels are 5400, 5500, and 5622: support levels are 5256, 5210, and 5020

DJIA futures are down 126 points.

Gold futures are at $3253, silver futures are at $31.60, and oil futures are at $59.82.

Protection Band And What To Do Now

It is important for investors to look ahead and not in the rearview mirror. The proprietary protection band from The Arora Report is very popular. The protection band puts all of the data, all of the indicators, all of the news, all of the crosscurrents, all of the models, and all of the analysis in an analytical framework that is easily actionable by investors.

Consider continuing to hold good, very long term, existing positions. Based on individual risk preference, consider holding *** in cash, Treasury bills, short term fixed income, or allocated to short-term tactical trades; and short to medium-term hedges of ***, and short term hedges of ***. This is a good way to protect yourself and participate in the upside at the same time.

You can determine your protection bands by adding cash to hedges. The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive. If you do not hedge, the total cash level should be more than stated above but significantly less than cash plus hedges.

A protection band of 0% would be very bullish and would indicate full investment with 0% in cash. A protection band of 100% would be very bearish and would indicate a need for aggressive protection with cash and hedges or aggressive short selling.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash. When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks. High beta stocks are the ones that move more than the market.

Traditional 60/40 Portfolio

Probability based risk reward adjusted for inflation does not favor long duration strategic bond allocation at this time.

Those who want to stick to traditional 60% allocation to stocks and 40% to bonds may consider focusing on only high quality bonds and bonds of five year duration or less. Those willing to bring sophistication to their investing may consider using bond ETFs as tactical positions and not strategic positions at this time.

DOLLAR SPOILING THE PARTY, INFLATION ANOMALY BUT STORM AHEAD, THE REAL REASON TRUMP REVERSED

Apr 10, 2025

To gain an edge, this is what you need to know today.

Storm Ahead

Please click here for a chart of S&P 500 ETF (SPY) which represents the benchmark stock market index S&P 500 (SPX).

Note the following:

The chart shows the post-Trump tariff reversal rise stopped right at the low band of resistance zone 2. This illustrates the power of the support and resistance zones as computed by The Arora Report. This is not a one time coincidence. Longtime members of The Arora Report know this has happened hundreds of times. This is one of the reasons longtime members cherish the charts from The Arora Report.
RSI on the chart shows there is more room for the stock market to go higher.
The chart shows that the volume on the rise was heavy. This indicates conviction.
In The Arora Report analysis, this morning there is selling on concerns about the rapid drop in the dollar. The stock market party triggered by the tariff pause is being hampered by selling in the dollar and bonds.
In the Arora Report analysis, the selling in the dollar and bonds appears to be coming from foreigners.
Prudent investors need to understand the real reason for the timing of President Trump’s quick reversal on tariffs after imposing them.
The following are the reasons given by the administration for the reversal:
- Art of the deal
- 75 countries wanting to negotiate
- Opinion of business leaders
In The Arora Report analysis, the foregoing played a role, but the real reason for the tariff reversal was likely the rise in bond yields.
As a member of The Arora Report, you were in the know from the beginning.
- From Tuesday’s Morning Capsule:

In The Arora Report analysis, prudent investors should pay attention to bonds. At this point in time, bonds are like a canary in the coal mine. Bond yields have rapidly risen from their lows yesterday morning in a dizzying move. Yields on 10 year Treasuries have risen from 3.865% yesterday morning to 4.226% as of this writing.

- The title of Wednesday’s Morning Capsule included “bond canary sick.” The Arora Report wrote:

The result of the $58B three year note auction showed weak demand. This indicates that the canary is sick.

In The Arora Report analysis, yesterday bond yields were getting close to triggering a full blown financial crisis. Treasury Secretary Bessent is an ex-hedge fund guy. He understands the bond market and knew it was time to act. It appears he prevailed with President Trump.
Here is what was extraordinary about the rising bond yields. Historically, when the stock market experiences a big drop, money flows out of stocks and into Treasury bonds. The higher money flows are into Treasury bonds, the lower the yields. Treasury bonds historically act as a safe haven. Over the last two days, in extraordinary behavior, instead of acting like a safe haven as they have historically, Treasury bonds were cratering at a dizzying pace. Bonds move inverse to the yield.
In The Arora Report analysis, the reason bonds were behaving extraordinarily was that the U.S. as a country was losing its safe haven status.
Looking forward, in The Arora Report analysis, gold may be replacing Treasury bonds as a safe haven. The Arora Report gold ratings are used by investors, hedge funds, bullion dealers, and jewelers across the globe. You can access the gold ratings from the main menu. Gold ETF GLD is in ZYX Allocation Model Portfolios.
- The core gold position is a strategic position.
- Recently, a signal was given for an additional trade around position as a tactical position in gold in ZYX Allocation. Yesterday, profits were taken in the trade around position.
- The foregoing is an example of judicious use of strategic positions and tactical positions.
- With the judicious use of strategic positions and tactical positions, you can dramatically increase returns and reduce risks. This is one sophistication element that all investors should consider learning. Please see Trade Management Guidelines. Those who want deeper knowledge or want to shorten the learning process by a decade may consider attending the Higher Returns With Bulletproof Techniques seminar.
Prudent investors should note that trade talks with China have not yet started.
Initial jobless claims came at 223K vs. 225K consensus. This indicates that the jobs picture is still strong. Prudent investors need to keep in mind that historically the jobs picture can deteriorate very quickly.
In The Arora Report analysis, the just released inflation data is an anomaly. Headline Consumer Price Index (CPI) has been driven lower by falling gasoline prices. CPI came cooler than expected. Here are the details:
- Headline CPI came at -0.1% vs. 0.1% consensus.
- Core CPI came at 0.1% vs. 0.3% consensus.
In the Arora Report analysis, a storm is likely ahead as tariffs take hold. The tariffs will likely be less than the ones that were paused for 90 days. President Trump appears to be insisting on a 10% floor on tariffs.
In the middle of the euphoria, prudent investors need to remember that there is a high probability for the scrooge of stagflation to raise its ugly head. You do not want the scrooge of stagflation to drain your portfolio. For those who want next level information, there is a new podcast in Arora Ambassador Club and more podcasts on stagflation are coming.
As an actionable item, the sum total of the foregoing is in the protection band, which strikes the optimum balance between various crosscurrents. Please scroll down to see the protection band. The protection band is one of the large number of unique edges that are available to members of The Arora Report.

Magnificent Seven Money Flows

In the early trade, money flows are negative in Amazon (AMZN), Nvidia (NVDA), Microsoft (MSFT), Alphabet (GOOG), Meta (META), Tesla (TSLA), and Apple (AAPL).

In the early trade, money flows are negative in S&P 500 ETF (SPY) and Nasdaq 100 ETF (QQQ).

Momo Crowd And Smart Money In Stocks

The momo crowd is *** stocks in the early trade. Smart money is *** in the early trade.

Very Very Short-Term Indicator

Gold

The momo crowd is *** gold in the early trade. Smart money is *** in the early trade.

For longer-term, please see gold and silver ratings.

Oil

The momo crowd is *** oil in the early trade. Smart money is *** in the early trade.

For longer-term, please see oil ratings.

Bitcoin

Bitcoin (BTC.USD) is seeing buying. The data from the recent stock market swoon is clear that bitcoin is not a hedge, and cryptos other than bitcoin suffer bigger losses during times of stress Ironically, crypto promoters continue promoting cryptos as a hedge to the unsuspecting masses.

Markets

Interest rates are ticking down, and bonds are ticking up.

The dollar is weaker.

S&P 500 futures are trading at 5382 as of this writing. S&P 500 futures resistance levels are 5400, 5500, and 5622: support levels are 5256, 5210, and 5020.

DJIA futures are down 538 points.

Gold futures are at $3140, silver futures are at $30.93, and oil futures are at $60.20.

HERE IS HOW TO LOOK AHEAD IN THIS MARKET, CHINA DASHES STOCK MARKET BULLS HOPIUM, BOND CANARY SICK

Apr 9, 2025

To gain an edge, this is what you need to know today.

Look Ahead

Please click here for a chart of S&P 500 ETF (SPY) which represents the benchmark stock market index S&P 500 (SPX).

Note the following:

The chart, along with the Morning Capsules, illustrate the power of looking ahead. As important as it is to look ahead, it is equally important to learn what not to do. The chart illustrates a powerful example of what not to do. The chart shows the momo crowd fell into the trap of not looking ahead.
- The chart shows that the momo crowd was buying Friday morning because the momo crowd believed that the stock market bottom was in place after the selloff on Thursday.
- The chart shows a major drop on Friday after the momo crowd aggressively bought. The drop caused the momo crowd to panic and sell near the lows.
- Later on Friday and over the weekend, proclamations from momo gurus that Monday would see a crash like 1987 spread like wildfire. As a reference, in 1987, the stock market fell over 20% in one day.
- The chart shows the momo crowd panicked on Monday morning and sold at the lows.
- The chart shows that the stock market rallied on Monday after the momo crowd sold.
- On Tuesday morning, the momo crowd discovered that negotiations were ahead. Of course, as a member of The Arora Report, you already knew about potential deals the day before from Monday’s Morning Capsule. We wrote:

In the middle of all of this gloom, The Arora Report would like to point out green shoots.
- President Trump had a very positive call with the Secretary of the Communist Party of Vietnam. Vietnam is indicating zero tariffs on U.S. goods.
- Taiwan is choosing not to retaliate but instead to work with President Trump.
- India is choosing not to retaliate and instead focus on a bilateral trade deal with the U.S.
- Cambodia is choosing not to retaliate and is actively seeking to negotiate with the U.S.
- Mexico is taking a measured approach and does not intend to engage in tit-for-tat tariffs.
- The U.K. is taking a measured approach.
- Elon Musk is floating the idea of a zero tariff trade zone between Europe and the U.S.

- On Tuesday morning, the momo crowd bought aggressively. The momo crowd forgot that 50% additional tariffs on China were ahead. As a member of The Arora Report, you knew ahead of time that additional tariffs on China were coming. Tuesday morning, when the stock market was running up like crazy, we wrote:

In the middle of the euphoria that has broken out this morning, Wall Street is not thinking ahead.

How will the stock market react if Trump goes ahead and imposes 50% additional tariffs on China?
- The chart shows when the stock market started realizing that additional China tariffs were ahead.
- The chart shows that after the stock market realized China tariffs were ahead, the stock market fell. The chart shows that the stock market drop picked up steam after the White House confirmed new China tariffs.
- After buying near the highs in the morning, the momo crowd again panicked and sold near the lows yesterday.
- The chart shows that early this morning, the momo crowd was buying again because China had not responded to the additional tariffs.
- The chart shows that the stock market started falling again when China retaliated with 84% tariffs on U.S. goods.
The foregoing illustrates the foolishness of not looking ahead and buying when the market goes up, only to sell when the market goes down.
In The Arora Report analysis, prudent investors need to understand the following:
- To stay in control in China, for domestic reasons, President Xi cannot appear to have bowed to President Trump.
- The U.S. strategy is to isolate China. If the U.S. is successful in isolating China, China will have no choice but to give into President Trump.
- China’s strategy is to isolate the U.S. If China is successful, President Trump will have no choice but to give into China.
- It is a game of chess. In The Arora Report analysis, if President Trump is able to hold his nerve, the U.S. will be the likely winner. If President Trump loses his nerve, China will be the likely winner.
The U.S. has an advantage for three reasons:
- The U.S. is a trade deficit nation. In a trade war, a trade deficit nation always has an advantage.
- The U.S. consumer is very powerful compared to the Chinese consumer.
- The U.S. has more allies than China.
In The Arora Report analysis, the U.S. is in a very good position with 70 countries, other than China, and is likely to come out way ahead compared to the present state of other nations continuously taking wealth out of the U.S.
For investors to fully understand what is happening and how it might end, investors may refer to the change curve that Nigam Arora described in his book titled “Theory ZYX of Successful Change Management: A Definitive Guide to Reach the Next Level.” Nigam wrote in his book that when a major change is envisioned, those who have benefited from the status quo rise up with hue and cry. The reason for hue and cry is that the change is like taking candy away from a baby. On the flip side, since the change has not yet occurred, no one has benefited from the change. There you have it – on one side you have a large segment of the population that will lose from the change, and on the other side, no one has yet benefited from the change.
In The Arora Report analysis, most major U.S. corporations and about 20% of the U.S. population have become significantly wealthier by the hollowing out of America. These beneficiaries will be the losers from President Trump’s policies. The problem with the stock market is the 20% who have benefited are the ones who own stocks outside of retirement accounts. On the flip side, about 50% of the U.S. population that has lost out from the hollowing out of America does not own stocks.
In The Arora Report analysis, if President Trump can hold his nerve, in the long run the change will be good for stock market investors. As we have written before, the problem is the chasm in the short term. Having said that, prudent investors should not ignore the risk in the long term if one of the following occurs:
- President Trump loses his nerve.
- President Trump loses public support in the U.S.
- Instead of the U.S. succeeding in isolating China, China succeeds at isolating the U.S.
Looking ahead, consider the following:
- Follow one of the tenants of The Arora Report method to always be booking some profits. From the Trade Management Guidelines: “The concept is to take partial profits to reduce risk and let the remaining position run for the profits to grow. The judicious combination of the two leads to maximizing risk adjusted returns over a long period of time over a large number of trades.”
- Since Trump’s re-election, The Arora Report has given 235 profit taking signals. This is an example of practical actions in accordance with the principle explained above. Investors who took advantage of the 235 profit taking signals now have some cushion as long term positions suffer.
- Following the protection band.
- A judicious combination of long term strategic positions, short term tactical positions, cash, gold, and hedges.
In yesterday’s Morning Capsule, we wrote:

In The Arora Report analysis, prudent investors should pay attention to bonds. At this point in time, bonds are like a canary in the coal mine. Bond yields have rapidly risen from their lows yesterday morning in a dizzying move. Yields on 10 year Treasuries have risen from 3.865% yesterday morning to 4.226% as of this writing.

The result of the $58B three year note auction showed weak demand. This indicates that the canary is sick. Here are the details of the auction:
- High yield: 3.908%
- Bid-to-cover: 2.70
- Indirect bid: 62.5%
- Direct bid: 26.0%
At this time, consider paying attention to the protection band and paying attention to new signals. For example, partial profits were taken on the Nvidia (NVDA) trade around position at $103.86 and $105.33 yesterday. Earlier this morning, NVDA stock traded as low as $93.25. The core NVDA position that is long from $12.55 has hedges. These hedges have become very profitable. Recently, partial profits were taken on the hedges.
As of this writing, the dollar is experiencing a big drop. The stock market is liking it, but this should be of concern to investors.
Important economic data is ahead. Consumer Price Index (CPI) and initial jobless claims will be released tomorrow at 8:30am ET. Producer Price Index (PPI) will be released Friday at 8:30am ET.
As an actionable item, the sum total of the foregoing is in the protection band, which strikes the optimum balance between various crosscurrents. Please scroll down to see the protection band. The protection band is one of the large number of unique edges that are available to members of The Arora Report.

Magnificent Seven Money Flows

In the early trade, money flows are like a yoyo in Amazon (AMZN), Microsoft (MSFT), Alphabet (GOOG), Meta (META), Tesla (TSLA), Apple (AAPL), and NVDA.

In the early trade, money flows are like a yoyo in S&P 500 ETF (SPY) and Nasdaq 100 ETF (QQQ).

The foregoing indicates a high degree of instability this morning.

Momo Crowd And Smart Money In Stocks

The momo crowd is *** in stocks in the early trade. Smart money is *** in the early trade.

Very Very Short-Term Indicator

Gold

The momo crowd is *** gold in the early trade. Smart money is *** in the early trade.

For longer-term, please see gold and silver ratings.

Oil

API crude inventories came at a draw of 1.057M barrels.

The momo crowd is *** oil in the early trade. Smart money is *** in the early trade.

For longer-term, please see oil ratings.

Bitcoin

Bitcoin (BTC.USD) is seeing selling.

Markets

Interest rates are ticking up, and bonds are ticking down.

The dollar is weaker.

S&P 500 futures are trading at 4962 as of this writing. S&P 500 futures resistance levels are 5020, 5210, and 5256: support levels are 4852, 4826, and 4770.

DJIA futures are down 446 points.

Gold futures are at $3061, silver futures are at $30.16, and oil futures are at $56.11.

INVESTORS PAY ATTENTION: 70 COUNTRIES WANT TO NEGOTIATE WITH TRUMP BUT CHINA TO ‘FIGHT TO THE END’

Apr 8, 2025

To gain an edge, this is what you need to know today.

Fight To The End

Please click here for a chart of S&P 500 ETF (SPY) which represents the benchmark stock market index S&P 500 (SPX).

Note the following:

The chart shows that the stock market has moved up and is now in resistance zone 1.
RSI on the chart shows that in spite of the rally, the stock market is still oversold. If the rally takes hold, the stock market can go much higher.
The chart shows that the volume yesterday was even higher than the prior session. This indicates that sellers are temporarily exhausted.
Prudent investors should pay attention to the volatility – the intraday range in S&P 500 futures spanned 9% yesterday. This is extraordinary.
As is often the case, there are crosscurrents this morning related to the trade war.
- After President Trump threatened additional 50% tariffs on Chinese goods on top of the already announced tariffs to punish China for retaliation, China is promising to fight to the end.
- 70 countries are coming to the table to negotiate with Trump instead of retaliating.
- Nikkei 225 in Japan jumped 6% overnight as Japan appears to be one of the first countries to negotiate with President Trump.
Sentiment has made one of the fastest switches ever. Sentiment has swung from extremely negative on Friday and yesterday morning to extremely positive this morning.
- Stock market gurus who were shouting from the tops of their lungs on Friday and over the weekend that Monday would see a 1987 style crash in which the stock market fell by over 20% in one day are claiming this morning that they were right.
- Stock market gurus who were beating their chests urging their followers to buy stocks when S&P 500 was hitting its high around 6100 are claiming this morning that they were right
- Wall Street is a happy place this morning in a remarkable switch from near panic in overnight trading on Sunday night.
In The Arora Report analysis, when sentiment swings so widely from one extreme to the other, it indicates a lack of stability and investors are mainly being driven by emotions. The emotions of both greed and fear are your enemy. Consider being highly disciplined, highly analytical, and totally data driven.
In the middle of the euphoria that has broken out this morning, Wall Street is not thinking ahead.
- How will the stock market react if Trump goes ahead and imposes 50% additional tariffs on China?
- How will the stock market react if negotiations with friendly countries such as Japan do not proceed as quickly as the stock market anticipates?
- Consumer Price Index (CPI) and Producer Price Index (PPI) are ahead this week. CPI and PPI are lagging indicators. How will the stock market react if these lagging indicators start showing that inflation is persistent? We have been sharing with you that leading indicators are showing that inflation is persistent. Of course, there is also the flip side – if CPI and PPI come lower than expected it will add fuel to the fire of bullishness.
- In The Arora Report analysis, the scrooge of stagflation potentially raising its ugly head is still present.
- The growth in the U.S. economy has been, in large part, driven by excessive government borrowing and government spending. What will happen to the growth if President Trump truly succeeds at cutting government spending?
- On the positive side, tax cuts and deregulation are ahead.
In The Arora Report analysis, prudent investors should pay attention to bonds. At this point in time, bonds are like a canary in the coal mine. Bond yields have rapidly risen from their lows yesterday morning in a dizzying move. Yields on 10 year Treasuries have risen from 3.865% yesterday morning to 4.226% as of this writing. This has three interpretations:
- The panic is over.
- Stagflation is coming.
- Many experts are claiming that foreigners are selling U.S. Treasuries. In The Arora Report analysis, at least for today, this interpretation is wrong. This is clear from the moves in the dollar.
Both bulls and bears are claiming that a capitulation has occurred. The Arora Report has never been afraid of making contrary calls. The vast majority of highly contrary calls from The Arora Report have proven spot on over the last 18 years. In The Arora Report analysis, only fast moving hedge funds have capitulated, but no one else capitulated. For The Arora Report to give a signal to back up the truck and buy stocks, almost everyone needs to capitulate. Again, it is important to be highly analytical and not get carried away with the bullish euphoria of this morning.
As an actionable item, the sum total of the foregoing is in the protection band, which strikes the optimum balance between various crosscurrents. Please scroll down to see the protection band. The protection band is one of the large number of unique edges that are available to members of The Arora Report.

Magnificent Seven Money Flows

In the early trade, money flows are positive in Amazon (AMZN), Nvidia (NVDA), Microsoft (MSFT), Alphabet (GOOG), Meta (META), Tesla (TSLA), and Apple (AAPL).

In the early trade, money flows are positive in S&P 500 ETF (SPY) and Nasdaq 100 ETF (QQQ).

Momo Crowd And Smart Money In Stocks

The momo crowd is *** stocks in the early trade. Smart money is *** stocks in the early trade.

Very Very Short-Term Indicator

Gold

The momo crowd is *** gold in the early trade. Smart money is *** in the early trade.

For longer-term, please see gold and silver ratings.

Oil

The momo crowd is *** oil in the early trade. Smart money is *** in the early trade.

For longer-term, please see oil ratings.

Bitcoin

Bitcoin (BTC.USD) is seeing aggressive ***. The momo crowd’s favorite software company Strategy Incorporated (MSTR), whose primary business is to buy bitcoin, lost $5.91B in bitcoin in the last quarter. How is the momo crowd responding to the news of the huge loss? The momo crowd is aggressively buying MSTR stock.

Markets

Interest rates are ticking up, and bonds are ticking down.

The dollar is weaker.

S&P 500 futures are trading at 5218 as of this writing. S&P 500 futures resistance levels are 5256, 5400, and 5500: support levels are 5210, 5020, and 4918.

DJIA futures are up 1053 points.

Gold futures are at $3020, silver futures are at $30.18, and oil futures are at $61.31.

PROTECTION BAND IS THE ANSWER FOR INVESTORS – WALL STREET ABANDONS TRUMP BUT TRUMP APPEARS RESOLUTE

Apr 7, 2025

To gain an edge, this is what you need to know today.

Wall Street Abandons Trump

Please click here for a chart of S&P 500 ETF (SPY) which represents the benchmark stock market index S&P 500 (SPX).

Note the following:

The chart shows the stock market is now in support zone 3.
The chart shows the stock market touched the low band of support zone 3 early this morning.
The chart shows that as of this writing, the stock market has bounced from the low band of support zone 3 to the top band. The stock market is extremely volatile. As an example, even a large stock like Microsoft (MSFT) has traded as low as $337.88 and as high as $358.40 in the premarket.
The chart shows the prior support zone 2 is now resistance zone 1.
The chart shows volume was heavy on the drop on Friday. This indicates conviction in the move.
RSI on the chart shows the stock market is now very oversold. Oversold markets tend to bounce.
All investors should understand capitulation because capitulation tends to form lasting bottoms. For those wanting next level information, there is a podcast titled “THE TEN SECRETS OF EPIC CAPITULATION RICHES” in Arora Ambassador Club. These are the secrets that led The Arora Report to make the highly contrary and bold call to back up the truck and buy stocks on March 9, 2009 when Wall Street was almost universally issuing sell signals. With the benefit of hindsight, March 9, 2009 turned out to be the exact bottom that started over a decade long bull market. Due to your numerous requests over the weekend, membership to Arora Ambassador Club is temporarily open for today only. If you would like to receive an invitation to join Arora Ambassador Club, please write to ambassador@TheAroraReport.com.
In overnight trading and early this morning, the fastest hedge funds are showing signs of capitulation. However, retail investors, slower hedge funds, and institutional investors are not showing any signs of capitulation. Instead of capitulating, such investors are buying. Such buying can result in a bounce, but the bounce may not be an enduring bottom unless there is good news on the trade front.
You may recall The Arora Report’s recent call has proven spot on now with the benefit of hindsight – buy tactical positions on President Trump’s re-election and sell them on Trump’s inauguration. In contrast, Wall Street’s call was to aggressively buy until Wednesday of last week. Wall Street had investors buying aggressively from the market top all the way to Trump announcing reciprocal tariffs – Wall Street had gone gaga over President Trump and simply did not believe what President Trump was saying. Now that the stock market has experienced a significant drop over the last two days, Wall Street has turned against President Trump. Now, Wall Street is selling after the drop.
Wall Street is now urging President Trump to back off from the tariffs.
President Trump is responding by being resolute on tariffs saying that the Fed should cut rates.
In The Arora Report analysis, it would be highly unwise for the Fed to cut rates. Further, in The Arora Report analysis, if the Fed were to cut rates, it would increase the probability of stagflation. Think about this – if the Fed were to cut rates to counter tariffs and then in a short time Trump reaches great deals with several countries, will the Fed then raise interest rates? Fortunately for long term investors, in his speech on Friday, Fed Chair Powell showed that he has a spine, at least at this time, and did not promise rate cuts. However, prudent investors should remember the experience of 2018 when Powell lost his spine as the stock market dropped and relentless pressure from President Trump mounted.
In the middle of all of this gloom, The Arora Report would like to point out green shoots.
- President Trump had a very positive call with the Secretary of the Communist Party of Vietnam. Vietnam is indicating zero tariffs on U.S. goods.
- Taiwan is choosing not to retaliate but instead to work with President Trump.
- India is choosing not to retaliate and instead focus on a bilateral trade deal with the U.S.
- Cambodia is choosing not to retaliate and is actively seeking to negotiate with the U.S.
- Mexico is taking a measured approach and does not intend to engage in tit-for-tat tariffs.
- The U.K. is taking a measured approach.
- Elon Musk is floating the idea of a zero tariff trade zone between Europe and the U.S.
In The Arora Report analysis, a positive scenario can emerge – President Trump starts announcing deals with several counties, and the stock market rallies. Here is the key question: Will President Trump have the nerve to stand against Wall Street and some of his base?
There is a wide range of outcomes possible – it is all in the hands of President Trump. There are rumors that President Trump is planning on imposing new tariffs. If new tariffs are imposed and no deals are struck with other countries, the stock market can go down another 15% – 20% from here.
The best way for investors to handle the situation is to consider the following:
- Follow the protection band
- Follow hedges on individual positions
- Differentiate between strategic positions and tactical positions
- Have short positions. If you do not short sell, it is time to start learning. The best way to learn is to become a member of ZYX Short, not doing any trades initially, just learning.
- Large position in gold. However, keep in mind that as the momo crowd gets margin calls, they often sell gold because they have no other choice.
Important economic data is ahead. Consumer Price Index (CPI) and initial jobless claims will be released Thursday at 8:30am ET, and Producer Price Index (PPI) will be released Friday at 8:30am ET.
As an actionable item, the sum total of the foregoing is in the protection band, which strikes the optimum balance between various crosscurrents. Please scroll down to see the protection band. The protection band is one of the large number of unique edges that are available to members of The Arora Report.

Magnificent Seven Money Flows

In the early trade, money flows are negative in MSFT, Amazon (AMZN), Nvidia (NVDA), Alphabet (GOOG), Meta (META), Tesla (TSLA), and Apple (AAPL).

In the early trade, money flows are negative in S&P 500 ETF (SPY) and Nasdaq 100 ETF (QQQ).

Momo Crowd And Smart Money In Stocks

The momo crowd is *** stocks in the early trade. Smart money is *** in the early trade.

Very Very Short-Term Indicator

Gold

The momo crowd is *** gold in the early trade. Smart money is *** in the early trade.

For longer-term, please see gold and silver ratings.

Oil

The momo crowd is *** oil in the early trade. Smart money is *** in the early trade.

For longer-term, please see oil ratings.

Bitcoin

Bitcoin (BTC.USD) has cracked below $80K. Many bitcoin bulls are very disappointed because bitcoin gurus had sold them the premise that bitcoin would protect them against a drop in the stock market. More difficult than bitcoin for crypto bulls is that smaller coins are getting hurt very badly. For the crypto industry, smaller coins are a lot more profitable than bitcoin. As such, smaller coins have been aggressively promoted. In smaller coins, promoters have already made their money – it is the investors who are left holding the bag.

Markets

Interest rates are tickling up, and bonds are ticking down.

The dollar is stronger.

S&P 500 futures are trading at 4984 as of this writing. S&P 500 futures resistance levels are 5210, 5256, and 5400: support levels are 4918. 4852, and 4826.

DJIA futures are down 1026 points.

Gold futures are at $3049, silver futures are at $30.22, and oil futures are at $61.01.

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Nigam Arora

Nigam Arora is known for his accurate stock market calls. Nigam is a distinguished master of the macro. He is a popular columnist with over 100 million page views, an engineer, and nuclear physicist by background. Nigam has founded two Inc. 500 fastest growing companies and has been involved in over 50 entrepreneurial ventures. He is the developer of Theory ZYX of Successful Change Management and is the author of the book on Theory ZYX, as well as the developer of the ZYX Change Method for Investing.

Dr. Natasha Arora

Dr. Natasha Arora has significant expertise in investment analysis especially biotech, healthcare, and technology. Natasha is a graduate of Harvard Medical School followed by a postdoc at MIT. She has published several peer reviewed research papers in top science journals.

BTCUSD, DJIA, DXY, GLD, GOLD, JPM, MARKETS, MSFT, MSTR, NDX, NVDA, OIL, QQQ, SILVER, SLV, SPX, SPY, USO

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