Proflex Market Update - Wk 11

Welcome to another weekly update from Proflex!

The markets are under severe pressure. The S&P 500 and Nasdaq have now dipped below their levels from the Trump election victory, erasing not just the gains from tax optimism and business-friendly policies of new administration at fundamental level but also breaching the critical 200-day moving average (200DMA).

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Sentiment is at peak pessimism, with some of the worst oversold conditions we’ve seen in over three years.

We discussed these scenarios extensively in our recent community call—you can watch the recording here:

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Despite the gloom, we expect a technical bounce from these oversold levels. However, it’s crucial to monitor whether that bounce will turn into a sustainable rally or just a short-lived relief.

Tariffs, Trade Wars, and Consumer Concerns

The Trump administration’s aggressive tariff policies are weighing heavily on market sentiment. The administration is laser-focused on reducing spending and bringing down long-term treasury yields, but the side effect has been a sharp slowdown in consumer confidence and spending.

While manufacturing activity has held up so far, the big risk to the economy is the consumer sector—where pessimism is growing fast. The key hope for rejuvenating sentiment lies in the upcoming Republican tax bill, which aims to:

• Make the 2017 tax cuts permanent.

• Reduce corporate tax rates to boost investment.

• Introduce tax perks like exemptions on tips, aimed at easing the burden on workers.

This tax bill could be the turning point for both markets and consumer sentiment, and we’ll be watching its progress closely.

Bitcoin: Another Test of Strength at $80K

Bitcoin has fallen back to the $80,000 level, in line with the broader risk-off sentiment across financial markets. ETF outflows have been consistent, but this is not surprising given the prevailing pessimism.

Key insights:

• Bitcoin is holding psychological support at $80k, but we are monitoring closely for a decisive move.

• ETF inflows will be critical in the coming weeks to gauge renewed interest.

Where Do We Go from Here?

These are tough, painful markets—but history shows that these are also the times when the biggest opportunities arise. As the saying goes, “Buy when there’s blood on the streets.”

But it’s never easy. That’s why achieving better-than-market returns demands bold but calculated decision-making.

📢 Join the Discussion in Our Macro WhatsApp Group!​
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Proflex Subscribers – Staying Ahead of the Curve 📈

Separating Noise from Signal: In volatile markets, we help subscribers stay disciplined and focus on strategic long-term opportunities.

Best regards,

Raman Bindlish

Editor-in-Chief,

Blockstart Research

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