Buy this before Biden and Xi speak

Good morning!

The markets are down in early going after a 4-day winning streak for the Dow that would have put it on track to break 5 straight losing weeks. The S&P and Nasdaq were both on track for 3 straight days of wins.

My warning earlier this week that buying felt tired would appear to have been correct:

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Here’s my playbook:

1 – Biden & Xi call could spark a rally

This will be the first time both have spoken since Russia invaded Ukraine. If Xi is going to toss Russia under the bus, this could be the call that does it.

If there’s one truism that I’ve learned in all the time I’ve spent in the Far East and in China itself, it’s that China will always play to China’s interest.

China’s state media are already playing the call up as one of “issues of common concern” which is consistent with what I’m telling you. China’s media has also recently begun to report Ukrainian battlefield success and even highlighted civilian casualties from Russian attacks, for example.

If Russia was winning, the call would be with Putin but now the call will be with Biden to ensure China has a place at the table when hostilities cease.

Western media, for the most part is billing it as a “clash” or some sort of confrontation which completely misses the point. Sadly, as usual. (Read)

What you need to understand – and prepare for - is that the markets will rally if China “supports” Biden in any way shape or form so get ready for that if you haven’t already been using the selloff to your advantage.

There are all kinds of ways to play this.

Longer term, you know the drill. Best, not rest.

Shorter-term, a few call options to catch a short-term reflex rally may be ideal. I can also imagine that a few shares in leveraged ETFs would perform well into early next week if an upside run materializes.

Most investors won’t see this coming!

2 – Even Uncle Elon is concerned

Tesla planned to offer more than $1 billion in bonds backed by leases. However, global monetary policies and those pesky rising rates have roiled bond markets. Tesla had reportedly already placed a significant portion of the bonds in anticipation of the offering. (Read)

3 – FUD this

There are two types of cryptocurrencies: stuff that might actually have a widespread use one day and so-called “sh*tcoins” that are increasingly and very clearly bait for the get rich quick crowd.

Case in point …The Bored Ape Yacht Club, an NFT startup, introduced ApeCoin which was created for “future gaming and entertainment use.” Never mind that literally everything is apparently going to be the next best gaming or entertainment currency.

ApeCoin apparently hit a peak of $39.40 after launch then cratered to $10ish. And who owns most of it? … oh silly me … that’d be the founders, insiders and Bored Apes. (Read)

Somebody’s got a bridge to sell.

There IS a place for all things digital eventually but for now this is just like the early days of Silicon Valley IPOs … buyer beware!

4 – Did Netflix just shoot itself in the foot?

Netflix has been hammered by two things … the ongoing tech massacre and less than stellar new subscriber counts.

Now the company wants to suddenly crack down on sharing passwords, a practice that they’ve turned a blind eye to for years.

No doubt that’s a great way to make sure people aren’t stripping your content for free but it’s a surefire way to increase churn. Now there’s an incentive to subscribe for a month, binge the content and … cancel.

Not sure this is a smart move when keeping the customers that you have is super critical. Perhaps they could just bring back Longmire. (Read)

5 – I just gotta get one

EVs are all the rage but I figured, “what the heck, it’s Friday.” I could drive over everything in my path if I got one of these. You could too. (Read)

Bottom Line

If you're not playing to win, the markets will make that abundantly clear ... and very quickly at that.

Speaking of which, the April issue of One Bar Ahead™ is underway.

I’ll be sharing some unconventional choices when it comes to beating inflation, including a new fund that could be just the ticket when it comes to staying ahead of all the nonsense. Plus, a quick look at a choice that could double if even a fraction of what it’s working on “hits.” (Learn more if you’d like)

As always, let’s finish the week strong.

You got this – I promise!

Keith