Monday Takeaways: 7% in Four Days – Can This Rally Last?

Shah Gilani|April 28, 2025

A 7% market surge in just four days isn’t normal…

But neither is having a president with his finger on the market’s “buy button.”

Every time markets look shaky, the president knows exactly what to do: walk back tariff threats, mention a call with President Xi, and watch the shorts scramble to cover.

The VIX tells the real story here… it’s still above 25. That means there’s still fear despite the price action.

With Wednesday bringing Treasury refunding announcements, GDP data, and major tech earnings from Meta and Microsoft, followed by Apple and Amazon on Thursday…

This week could determine whether we’ve truly seen the worst… or are just experiencing the calm before another storm.

Tune in for your Monday Takeaways. Don’t miss what’s moving your money… NOW.

Click on the image below to watch.

Transcript

Hey, everybody. Shah Gilani here with your Monday Takeaways.

Got a lot to take away from last week. A lot of good feeling because the markets were up, ended on a good note Friday, didn’t give much back, which was all well and good. Futures are down a little bit this morning. But the takeaway from last week was after an absolutely horrible Monday, we had an astonishing week, an almost unprecedented week. So when you look back and ask, what happened over the last four days? Markets were up 7%.

Seven percent in four days. I’m talking about the S&P. Nasdaq was up more. So that’s close to unprecedented, especially given the uncertainty, especially given the volatility in the market. Speaking of volatility, let me go right to a chart, because I want to point out something.

It’s not about the market moving up being unprecedented. It’s about it moving up given this kind of volatility. This is the chart of the VIX, people. You can see the spikes.

This is a one-year chart of the VIX. You can see the spikes on Liberation Day and such, and they ratchet down, ratchet down. But guess what? We are still above 25 on the VIX.

Now the mean on the VIX is 19.5. For the markets to prove that they are calm and can digest whatever news flow is happening, they’re going to have to be below 20. They’re probably going to have to be below 19, maybe 18 handle, something like that. If we work our way down there as the markets rise, then we could have a continuing rally, but that remains to be seen.

We’re not anywhere near that. The VIX this morning, and again, it’s about 8:30 as I’m recording this, 25.44.

A one standard deviation move on the VIX from its mean of 19.5 would take it to 27.5. So we’re not even that far away from a one standard deviation move, which is a dangerous place to be because it just shows heightened investor anticipation of volatility because that’s what the VIX represents. It’s implied in what prices investors and traders are paying for puts and calls on the S&P 500, mostly puts. In other words, hedging, maybe playing to the downside.

So we have that to worry about. We’re not out of the woods yet. Now as far as the S&P goes, yes, four days is fantastic, but it also came on the heels of an absolutely horrible day. So here’s this beautiful bar here that takes us right just above this descending trend.

So here’s the bull market, boom, boom, boom. And then we have this whole ugly fall off, and then we break through this, but come back. And now we’re in here just on Friday, just breaking out.

So Friday’s here. And, you know, if we go back to the 21st and Monday, that’s an ugly day. But then we have four beautiful days looking at these bars. Pop, pop, pop.

Yes, it’s nice to be just above this descending channel, but it doesn’t mean we’re out of the woods. We could very easily fall back in here. Futures are down this morning.

So the takeaway from all the action last week is that it’s all well and good to be up 7-plus percent on the S&P. But with the VIX still riding a 25 handle, investors are still nervous. So we have that to worry about. Does it mean we can’t get past all this?

Because once again, another takeaway from last week is the president actually walked back some of the tariff talks. So we’re seeing this is what the markets were doing. How did he walk it back? How did he talk it back?

He basically said that he was in conversation. He’d had a talk or a call with President Xi of China. Now nobody can confirm this. And even on the weekend programs, Scott Bessent and nobody said they heard him or agreed that, yes, there were talks.

So the president caused this rally. The president has been doing this. The biggest takeaway from what’s happening with the tariffs and the frightening part of the tariffs is that the upside to that frightening side is that the president has his finger on the buy button. And when the markets look a little shaky, he knows he can walk the markets back.

He can say something positive, and all of a sudden, you’re going to see a massive amount of short covering, and stocks are going to start to look cheap, and it’s rah-rah, pick up where you left off and buy, buy, buy.

Is that going to continue? Are people going to get tired of that? Maybe.

Is the president at some point going to have to lay down some tariffs to prove that he’s not bluffing? Maybe. Probably.

So what are the takeaways here?

The operative word is still uncertainty. Because though the president can walk back comments and negative aspects of what likely tariff impacts will be, and motivate buyers in the market, we’re not out of the woods in terms of the actual mechanics of tariffs. Now speaking of actual mechanics of tariffs, I came across something interesting early this morning. Bloomberg had a little something, a power strip, that you can buy from TEMU, the Chinese small goods, very inexpensive platform, buy all kinds of great stuff, really good prices. TEMU had a power strip listed at $19.49. The “import charge” on top of that was $27.56.

Wow. So your power strip, that once could have cost you $19.49, you have to pay an additional $27.56 starting today.

That’s not cool. So, again, tariffs are going to have an impact. We have a big week coming up, and I think the takeaways are going to be as they fall on the days they fall.

We have a big day coming up on Wednesday.

The Treasury is going to announce its upcoming auction agenda, so we’re going to find out what they’re going to have to raise, and what maturities they’re going to put out and how much. And that can move markets. If it’s more in certain maturities than investors expect, there might be some pressure to the downside of the bond market. So refunding plans are going to be important coming out on Wednesday.

Wednesday, we also get a look at GDP for the first quarter. That’s going to be interesting. Should be pretty good because there was a lot of buying forward because of the tariffs. So we’ll see what happens.

If that is good, then maybe the markets will say, OK, we’re not out of the woods yet, but things are still good and might be a positive. Don’t know. You also have personal consumption numbers on Wednesday. So Wednesday is a big day, but it gets even bigger because I think what’s more important than those numbers really are earnings, earnings, earnings. And on Wednesday, we’ve got Meta and Microsoft followed Thursday by Apple and Amazon.

Also Thursday, we have jobless claims. Friday, there’s nonfarm payrolls. So it is a busy week.

About close to 40% of S&P 500 companies are reporting this week. That’s a tremendous week of earnings data flow. So the takeaway there is, futures are relatively flat. I’m going to call them close to flat right now, a little after 8:30, and we’re going into a very interesting week.

So the takeaway from all of this is, yes, we’re still uncertain about where we’re going to go, but I’m leaning more and more into thinking we maybe have seen the worst of this, unless the president backtracks on stuff and slaps China with some really ridiculous things. If we get into this trade war that everyone’s so afraid of, yes, we could backtrack, test the lows. But the president doesn’t want to do that. He’s already looking pretty bad.

His first hundred days are the worst hundred days and they end April 30. His first hundred days are the worst hundred days for a president since Gerald Ford. And Gerald Ford’s first hundred days came after the resignation of Richard Nixon. But his first hundred days, the market was down about 10.2%.

And as far as President Trump, markets since his inauguration are down around 8%. So not a very good start. And his ratings are falling, so he’s got an eye on all that. That’s why I think maybe it’s a time to keep buying stuff.

We’re buying stuff on dips. And I think the takeaway from the walk-backs, from the little boost he’s trying to give the market to see if he can, and he’s been successful doing that, is that he doesn’t want the market to go too much lower. So take that, put that in your back pocket, maybe go spend it on some good cheap stocks. I’ll catch you guys next week.

Cheers.