Trumpy Bear Gets a Squeeze

The seemingly endless headline-driven pops and drops related to tariffs and trade wars continue today, as the President announced on Sunday evening that he would be delaying his EU 50% tariffs for about five and a half weeks from the original June 1st target date. At some point, and it may already be slowly starting to happen, the market will tune out the constant Trump tough-talk-and-retreat combo--You can only run so many bluffs before they get picked off. 

Overall, with this gap up we have the Nasdaq back inside a two week sideways range as we head into NVDA earnings tomorrow evening. While I usually refrain from guessing or playing earnings, in this particular context the analogy of NVDA to CSCO from the dot-com bubble still seems compelling.

On the second quarterly chart, below, of CSCO off to the lefthand side there is an arrow showing the August 2000 post-earnings selloff. The stock delivered good numbers but still sold and never looked back, cementing a generational top for the hottest name in that bull market mania. 

It would not surprise me at all to see a similar sequence play out for NVIDIA later this week. 

Elsewhere, O'Reilly Automotive Inc., first below on the quarterly chart, is red and lagging he market. ORLY has been, easily, one of the most potent multi-year uptrends in the entire market. This may finally be the sign the stock is out of gas (no pun intended).