Earnings Drive the Market - Not Algos!
Key catalysts, credit spreads, and setups I'm watching.
Introduction: Big year ahead!
Hello Pulsers,
It’s been a minute. Between trading, work, and some major life updates (including planning a wedding!), I’ve been heads down. But I’m back—and more focused than ever.
Last year was a standout. I earned over $600,000 in combined income from trading and employment, and for the first time ever, trading income outpaced my salary. That was a major milestone for me.
This year, I’m recommitting to:
Writing this newsletter consistently
Sharing insights that help you sharpen your edge
Developing a course and writing additional books on trading
Thanks for sticking around—and if you enjoy what I share, feel free to forward this to someone in your circle.
🔍In This Issue
Here are key things I am covering in this week’s issue:
Tariffs & their impact on U.S. GDP
Earnings surprises & credit spreads
My current trade setups and positions
📊On Markets
Key Catalysts Over the Past Few Weeks:
Q1 U.S. GDP and what it signals for Q2+
Corporate earnings (and the positive surprise)
Interest rate outlook
Credit spreads & bond market signals
Earnings:
Despite recent volatility, earnings have surprised to the upside. The market anticipated ~6% growth—but actual numbers came in closer to 12%. That's a bullish signal. As long as earnings stay strong, equities will likely continue trending higher.
While SPY 0.00%↑ has regained all of its losses post-trade war, and some of this gain may be attributed to the deals that have been announced, the reality is that the number one predictor of market returns is not flows or algorithms, but earnings.
When earnings are strong, the market tends to rise, and when earnings disappoint, the market tends to decline or remain flat.
Reminder: Earnings—not flows, not algos—remain the strongest predictor of market performance.
But despite the equity market returning to its highs post-liberation day, the bond market is still nervous and has not fully recovered.
Bond Market:
Equities may have recovered post–trade war, but the bond market remains cautious. Notably:
Investment-grade credit spreads haven’t returned to pre-war levels.
Wider spreads indicate higher perceived risk.
Tighter spreads mean investors are more comfortable holding corporate risk over Treasuries.
In short: the equity market may be cheering, but the bond market isn’t buying the same optimism—yet.
Interest Rates:
The Fed has held short-term rates steady. This puts continued pressure on:
Housing
Rate-sensitive sectors (auto, discretionary, etc.)
Credit expansion and consumer spending
Keep an eye here—no cuts means headwinds remain.
📈On Positions
Currently, I have the following live trades and open positions in the market, along with the reasoning behind each. Please note that these trades are mine, and mine only and they may be delayed. Follow along this trade here: https://bit.ly/3KPN2lJ
Last Words
As many of you have seen, most of the charts and analyses I use are from Interactive Brokers. Interactive Brokers provides some of the best commission structures, yields on idle cash, and, more importantly, one of the best tools for active trading. As an active options trader, I can only imagine myself trading with the tools that they have provided.
If you are still deciding, check out their free simulator and everything else they provide to help you get started.
Below are the links to help you get started.
Lastly, if you enjoy my writing and delivery, and if you have not already, make sure to check out my best-selling book on Amazon! It has been a best seller for four years in a row! Please support my work by purchasing my book and leaving me an honest review. It is also the best gift you can give your loved ones this holiday.
Thank you for supporting my work.
Disclaimer
The opinions provided in this newsletter are mine and mine only and do not represent any firm or other affiliation.
You understand that NO content published and discussed during this newsletter constitutes a recommendation that any particular investment, security, portfolio of securities, transaction or investment strategy is suitable for any specific person.
You further understand that I will NOT advise you personally concerning the nature, potential, value or suitability of any particular investment, security, portfolio of securities, transaction, investment strategy or other matter.
This presentation and the content provided are for educational purposes only.
Share
Thanks for reading Market Pulse with