Trumped!
Contributed Opinion

1. As of the date of this article, officers, contractors, shareholders, and/or employees of Streetwise Reports LLC (including members of their household) own securities of Tesla Inc. and Fitzroy Minerals Inc. 
2. Michael Ballanger: I, or members of my immediate household or family, own securities of: Freeport-McMoRan and Fitzroy Minerals. My company has a financial relationship with: None. My company has purchased stocks mentioned in this article for my management clients: None. I determined which companies would be included in this article based on my research and understanding of the sector.
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Judging from the mood of the colour commentators on CNBC on the final trading day of the week and final Friday of the month and quarter, I would say that sentiment has taken a distinct turn for the worse and with it, Wall Street's love affair with their president.

The MAGA narrative that has seen perma-bull traders buying every dip imaginable in what is undoubtedly an overpriced market was founded upon the concept that the president, obsessed with stock price performance as a measure of his presidentially stewardship, will always favour stocks over any actions either domestic or foreign that might endanger stocks. Herein lies the genus of the "Taco Trade", as in the "Trump Always Chickens Out" trade.

This week, the most powerful man in the Western World tried valiantly to thwart the rampaging oil bulls by first posting on Truth Social last weekend that the U.S. was engaged in "productive talks" with Iran that would lead to a cessation in hostilities. Alas, after a mere single session of panicky oil trade liquidations and even-more-panicky stock market short covering, markets called his bluff after it became apparent that the Iranians have rejected any and all overtures related to a ceasefire and definitely no concessions regarding the Strait of Hormuz.

With stocks resuming the downtrend and oil resuming its uptrend, the "Taco Trade" was a definite "fail" as there was nothing Trump could do to arrest the slide in the Mag Seven as they all got summarily trounced going into the last weekly session and approaching month-end.

If you recall the period immediately after Trump was re-elected in 2024, stocks went on an immediate "Make America Great Again" rampage with the DJIA and S&P making record highs and there was nothing the Teflon Don could do wrong until he started reading too many of his own press clippings and started to threaten his allies with tariffs.

That was when the markets all started to unravel and when coupled with his efforts (with Elon Musk as attack dog) to cut out all of the effluent from the Washington pork parade, it was all "straight south" for most equities until he woke up in late March and saw that his popularity ratings were dropping like drawers at a frat party.

Horrified at the crashing NASDAQ, Trump finally recanted, going full "TACO trade" by rescinding and/or postponing most of the executive orders cancelling government departments and/or tariffs.

It then and only then that stocks caught a foothold and staged one of the most breathtaking reversals in history.

Last weekend, the President tried it again with those "productive talks" antics on Sunday such that by the time stocks opened last Monday, every business newscast was echoing the phrase "TACO trade" as this historic victory against the Iranian nation was a fait accompli.

All week long, he was proposing farm subsidy proposals in photo-op appearances to win back the narrative but by the end of the week, traders has fully lost all hope and faith and scrambled to get portfolios "DE-RISKED" by the weekend.

However, of note were a couple of interesting developments.

Gold and silver, locked in the same death spiral as stocks since the war began on February 28, decided to decouple from their inverse relationship to oil as well as their perfectly-correlated relationship with stocks and headed north as oil severed its month-long lockstep with equities.

The CBOE Volatility Index (VIX:US) closed at 31.05 which is important because spikes in volatility above 30 have historically been a signal to traders that the declines in stocks have been overdone.

The S&P/TSX Composite closed up as did the TSX Venture Exchange which was encouraging because the Canadian indices are heavily-weighted in resources, particularly the TSXV so for subscribers to this publication, that news is very good indeed.

As I wrote to subscribers in the Friday pre-opening alert: "One caveat to shorting this market is the possibility that the declines in March will force rebalancing of portfolio allocations. Managers adhering to the 60-40 model (60% stocks / 40% bonds) have seen a fairly sharp drop in the 60% portion thanks to the turmoil in the Middle East. As a result, they may need to swap some of the 40% portion  now at perhaps 45-50% bonds — for stocks — now at perhaps 50-55% — in order to get back to the model allocations. Some estimates have up to $70 billion of buying lined up by the 60-40 gang as part of this rebalancing.

That buying will start next week."

While the move in the VIX is not particularly predictive, the decoupling by gold and silver was very predictive because while gold and silver have been used historically as hedges against equity market drawdowns, the action in gold and stocks reeked of deleveraging. Portfolios teetering on the brink of destruction due to excessive leverage used their gold and silver positions to reduce overall leverage in their portfolios so as stocks declined, gold and silver (and the miners) were liquidated to reduce leverage. With gold and silver (and the miners) all rallying today against new 2026 lows in the S&P and NASDAQ, it tells me that equities are ready for a rally, even if it turns out to be your classic "meatball rally" that lures in all the suckers that blew out positions this week.

I have been a "closet bear" on U.S stocks and have been punished mercilessly in my dogged insistence that Tesla Inc. (TSLA:NASDAQ) be viewed not as a robotics company or an "AI" company but rather as an "EV" company, as they had been trumpeting all during the rise from $25 back in 2020. In fact, they decided to change the Tesla narrative shortly after Elon was displaced by Oracle Corp. (ORCL:NYSE) Chairman Larry Ellison on September 28^th as "the world's richest man". Within weeks, Elon went on a road trip around the world touting the robotics and "AI" transition for TSLA:US which took the stock (and Elon's net worth) to record highs.

Fast forward to March 2026 where the "AI" stocks were trashed violently right up until the final bell on the final trading day. With the new TSLA:US narrative now "AI" and robotics, what is the pivot to which Elon turns? Back to electric vehicles where China's BYD is eating their lunch?

I remain short TSLA:US via the T-Rex 2X's Inverse Daily Tesla ETF (TSLZ:US) where, despite averaging down in late 2025, I am still underwater by a paltry 3% (after being cyanotic in December down 45%) but I have told friends, colleagues, and subscribers that I will not cover the TSLZ:US position until I see Tesla Inc. trading under $100 per share. Call it emotional; call it irrational; call it "my decision" and may the chips fall where they choose.

Apologies for getting distracted on failed electric vehicle manufacturers masquerading as "AI" companies, I turned cautiously bullish this week on markets after liquidating most of my energy names and looking for a tradable rally in stocks to commence next week, led not by the same names of last year post-Liberation Day but by the commodity producers including copper, nickel and the precious metals.

This will not be the "TACO Trade" because markets no longer trust the statements coming out of the White House. It will be an oversold rally in most sectors but the beginning of the "C-Wave" in the miners, which is typically and historically a show-stopper.

As for the precious metals, I have been using the $4,400 level for April gold as my re-test level of support since the $5,200 level but after knifing down through $4,400 during the March 22^nd crash to the 200-dma at $4,127 a week ago, it has since recovered back above $4,400. As I wrote earlier in this missive, the cessation of selling pressure on Friday was a surefire indication that once again, gold served its purpose of anchoring portfolios against severe drawdowns which means that the de-leveraging process has largely run its course.

With the drop to the 200-dma, gold briefly dipped into "oversold" category for a very brief moment which I now view as a "successful re-test" setting us up for a tradable rally and possible long-term bottom.

Furthermore, downside risk should be limited to the uptrend line drawn off the October 2023 lows around $1,800 which sits around $3,750. Below that, I will take a ball-and-chain hammer to my forehead and chase my dog into the root cellar, an eventuality I consider highly unlikely.

Copper

Copper has been undergoing a correction not unlike the one we got in both gold, silver, and the broad equity markets but like April gold, May copper stopped on a veritable dime at the 200-dma at $5.24 and has since moved higher. There is always a point where panicky sellers are replaced with opportunistic buyers and that is what the watershed event was on March 22^nd. The last of the forced sellers were liquidated and the cash buyers emerged victorious with the one metal whose fundamental are markedly better than any other metal on the board and is now set to advance to test the January high at $6.6415/lb.

With great relief verging on a near out-of-body experience of both joy and fulfillment, I bought back the 1,000 share position in the best-run company on the planet — Freeport-McMoRan Inc. (FCX:NYSE) — at $52.30 after being out of it since acting like a rank amateur and selling it in a fit after the Grasberg Mine accident last summer.

I also added an initial tranche of the June calls on the expectation that I will see now record all-time highs by then above $70.

Despite all the furor over the Middle East and Private Credit in the month of March, I was blessed with the unique opportunity of watching all the copper stocks crash as the spectre of a 1973-1974 recession rushed in on the heels of $100 oil.

I also added to Fitzroy Minerals Inc. (FTZ:TSX.V; FTZFF:OTCQB)whose management group closed a CAD $21 million financing on March 23, the day after copper bottomed. It was an enormous testimonial to that management group that they closed it at $.50 per unit with the stock closing at CAD $.385 that day.

Institutional buyers from outside North America cared not about the near-term weakness and instead focused on the near-term production potential that is definitely in the cards for FTZ/FTZFF that involves minimal CAPEX requirements and a deep-pocketed partner, Pucobre S.A. (2^nd largest copper producer in Chile behind Codleco).

The week ended with headlines all pointing to breakdowns in the bond market with yields rising to levels approaching the death-defying height of 5% for the 30-year and 4.5% for the 10-year (U.S. Treasuries). At the end of the day, the bond markets around the globe are many multiples the size of the global stock markets with the global currency markets dwarfing them both. I watch with morbid fascination when the debate in the court of social media devolves into verbal jousting over "Gold versus Bitcoin" or "AI versus Robotics" or "Stocks versus Bonds" when the real debate should be firmly squared around the topic of DEBT.

When "chief investment strategists" at high-profile boutique brokerages write comprehensive articles on why "fiat currencies" are the only system of trade settlement available to the world without mentioning as much as one word about the erosion of purchasing power of the American currency since 1914, it absolutely boggles the mind.

Stocks have been declining due to fear over the inflationary impact of $100 oil which explains the reason the bond vigilantes have taken bond yields sharply higher. If rising energy costs are expected to throw the world economy into a recession, it is instructive to examine the reason yields are not declining in sympathy with lower global GDP. The reason is somewhat more insidious than simply "bonds fearing inflation". It revolves not around the idea of one's "return on investment" but rather the "return OF investment, as in one's principal. They estimate that it costs the U.S. government $1 billion per day to fund the current war effort in Iran so with interest payments on debt now exceeding the U.S. defense budget, how much longer can a technically insolvent country maintain its role as global policeman?

In order to survive, either the U.S. government must defend the dollar and in order to do that, they will need to attract buyers of their Treasury Bonds. They can do that in only one manner – increase yields – and if they do that the debt servicing costs become unmanageable.

If they cannot get buyers for Treasuries, then investors worry about the "return OF investment" and they sell dollars. Either way, the recent rally in the dollar is going to meet a wall of resistance above par creating a potential tailwind for commodities, including copper and oil, with honourable mention to the precious metals.

As the year rolls on, investors would be well-advised to carefully watch yields and the dollar as a failure to do so could result in portfolios failing to benefit from the "TACO Trade" but rather impudently pummelled from being "Trump-ed"…