BY ANDREW GIOVINAZZI
June 5th, 2025
Yo Pit Crazies,
Speaking of the unexpected—if you missed it, catch the replay of yesterday’s Hannah and Voz extravaganza! Don’t miss their standout performance on SPY Zones.
Suddenly, Elon Musk is lashing out at Congress for treating COVID-era spending as the new normal—much like how the Great Financial Crisis spending and the post-9/11 surveillance state became business as usual. For context, federal tax receipts have been steadily rising over the past 20 years.
The tug-of-war continues, with Congress once again deferring tough fiscal choices to future generations. I’m a supporter of term limits for members of Congress, as they could help reduce the incentive for endless spending—a tendency evident in both parties. Meanwhile, Tesla Inc. (Ticker: TSLA) has become something of a barometer for government policy: it soared on D.O.G.E-fueled optimism, stumbled amid reality, rebounded as Elon Musk’s tenure evolved, and is now struggling again amid tensions with Congress and his political ally, President Trump.
How is this affecting us?
Right now, it is not going good for Tesla Inc
Tesla’s stock has become a political lightning rod—for better or worse—and right now, it’s feeling the downside. Just five days ago, it was trading at $365, putting it close to a 20% drop from recent highs. After a 50% plunge following December’s rally, I believe this latest decline may be approaching a bottom.
6 month TSLA chart with 1 day candles
If you’re looking for insight into how the talks with President Xi went, keep an eye on MP Materials Corp (Ticker: MP).
When the rare earth giant MP rallies, it usually signals that President Xi is taking a tougher stance. Conversely, when tensions ease and Xi adopts a friendlier tone, MP often pulls back into the teens. As a major domestic rare earth player, MP tends to surge during periods of U.S.–China friction.
1 year MP chart
Frank has closely tracked MP over the past two years, navigating its volatile ups and downs. Today, we locked in some gains on the upside. With TSLA and MP now moving along opposite ends of their respective political narratives, trade accordingly.
To Your Trading Success,
AG
