July 6, 2025
Fellow traders and investors, been offline for a bit but what an absolutely WILD ride this market has been! If you've been following along, you know we've experienced one of the most dramatic market cycles in recent memory, and for those who played it right after Liberation Day, the rewards have been absolutely spectacular. I've successfully replaced most of my W2 take=home pay with passive income since April. My dividend payers are AGNC, ORC, YMAX, GIAC and WTPI. My only Long-term holding at the moment is NTLA. I continue to hold cash in a MM for the next bumps in the road. I sell PUTS with that and then some intraday covered-calls on NTLA. Probably done with the covered calls if the new base holds on NTLA.
All-Time Highs After the Storm
The market has been nothing short of a roller coaster, but we're now sitting at all-time highs! By June 27, 2025, the S&P 500 and the NASDAQ closed at all-time highs, with the S&P 500 gaining 0.5%, to close at a record 6,173.07. What makes this even more remarkable is where we came from.
Remember Liberation Day on April 2nd? That was when President Trump announced his sweeping tariff policies, sending shockwaves through the markets. The S&P 500 has tumbled more than 12% in the immediate aftermath, with some calling it one of the worst sell-offs since the pandemic. But here's the thing about markets - they hate uncertainty, and once that uncertainty started to clear, we saw an absolutely explosive recovery.
The Liberation Day Opportunity
For those brave enough to buy during the Liberation Day crash, you've been handsomely rewarded. The S&P 500 has been on a wild round trip: The index shed $9.8 trillion in market value from its previous record on February 19 to its low point on April 8, before recovering all of those losses across the past two and a half months.
The key was recognizing that President Donald Trump said on April 3 regarding his tariffs that events were "going very well", as the "markets are going to boom, the stock is going to boom, the country is going to boom". Smart money listened and positioned accordingly.
Income Powerhouses Leading the Charge
ELF Beauty - The Cosmetics Rocket Ship
Talk about a comeback story! ELF Beauty has been an absolute monster, and anyone who bought the Liberation Day dip is sitting pretty. Full year Fiscal 2025 net sales grew 28%, reflecting another year of industry-leading growth, and the company just announced an agreement to acquire rhode, a fast-growing beauty brand founded by Hailey Bieber for $800 million plus earnouts.
The Street is loving it, with the average price target is $122.00 with a high forecast of $150.00 and a consensus rating of Strong Buy which is based on 13 buy ratings, 3 hold ratings and 0 sell ratings. This isn't just growth - it's profitable, sustainable growth in a defensive consumer staple category.
OKLO - Nuclear Renaissance in Full Swing
Holy smokes, OKLO has been absolutely on fire! Oklo has been on an absolute tear, soaring 559.6% as of this writing over the past year. The nuclear energy renaissance is real, and OKLO is perfectly positioned.
With Sam Altman's OpenAI announcing the Stargate Project in January, investors raced to purchase Oklo, recognizing that the OpenAI plan to develop data center infrastructure could be a potential boon for the company. The data center boom is massive - Research from Dell'Oro Group estimates that global spending is expected to soar from $430 billion on data centers in 2024 to $1.1 trillion by 2029.
Gene Editing Stocks - The Future is Now
The gene editing space has been quietly building momentum, and these names are starting to show serious promise:
CRISPR Therapeutics (CRSP) continues to lead the pack with its revolutionary gene-editing platform. Bank of America has a "buy" rating and $86 price target for CRSP stock, and the company's partnership with Vertex on sickle cell disease treatments could be game-changing.
Intellia Therapeutics (NTLA) has been making waves with its in-vivo gene editing approach. In 2021, Intellia and its partner, Regeneron Pharmaceuticals announced the first clinical data supporting the use of in vivo (in the body) CRISPR-Cas9 gene editing in humans. Bank of America has a "buy" rating and $43 price target for NTLA stock.
Editas Medicine (EDIT) rounds out the big three, focusing on both in-vivo and ex-vivo approaches. The gene editing market is projected to explode, with analysts at Precedence Research expect the gene-editing market to grow 15.7% annually and reach $40.1 billion by 2034.
RKLB - Rocket Lab's Stellar Performance
Rocket Lab has been absolutely crushing it! RKLB stock has risen by 10.03% compared to the previous week, the month change is a 30.22% rise, over the last year Rocket Lab Corporation has showed a 670.19% increase. This space play has been one of our biggest winners.
Rocket Lab reported Q1 2025 revenue of $122.6 million, with $87 million driven by its high-margin Space Systems segment, and the company has $1.067 billion backlog, over 56% convertible within 12 months. With the space economy projected to triple, RKLB is perfectly positioned for the long haul.
The analysts are bullish too, with a median price target of $29.50 (ranging from $19.51 to $45.00) and the overall analyst consensus for RKLB is bullish. Out of 20 Wall Street analysts, 10 rate it as Buy, 4 as Hold, and 0 as Sell.
Rate Cuts on the Horizon
Here's where things get really interesting for the second half of 2025. The Fed is in a tough spot, but the consensus is building for rate cuts. Goldman Sachs economists raised their forecast for Federal Reserve interest rate cuts to three this year and increased the probability of a U.S. recession to 35%.
Asked how the Fed will respond to not only higher prices from tariffs and weakening growth and employment, 65% say the central bank will cut rates. This is huge for income-producing portfolios and growth stocks alike. Lower rates mean higher valuations and more capital flowing into risk assets.
Tariffs and Recession Risks - What's Really Happening
Let's address the elephant in the room. Yes, tariffs are inflationary and create economic headwinds. Goldman expects the average U.S. tariff rate to rise 15 percentage points in 2025, which is significant. However, markets are forward-looking, and much of the tariff impact has already been priced in during the Liberation Day sell-off.
The recession probability has increased - The odds of recession in the next year rose to 53%, up from 22% in January - but here's the key: J.P. Morgan Research has reduced the probability of a U.S. and global recession occurring in 2025 from 60% to 40% as trade tensions have eased and some tariff policies have been walked back.
Even if we do see economic weakness, "We're most likely not going to go into a serious recession, because the Fed can take action to prevent that" as Jim Cramer noted. The Fed has plenty of ammunition to support the economy.
The Bottom Line
We're living through one of the most dynamic and opportunity-rich markets in years. Yes, there's volatility, but that volatility creates opportunity for those willing to do the work and stay disciplined. The companies we've highlighted - ELF, OKLO, the gene editing names, and RKLB - aren't just riding market momentum. They're fundamentally strong businesses positioned in secular growth trends.
For income-focused investors, the combination of potential rate cuts and strong fundamental performance from dividend-growing companies creates a compelling setup. For growth investors, the innovation happening in nuclear energy, space technology, and gene editing represents generational opportunities.
Stay nimble, stay disciplined, and remember - in markets like these, fortune favors the bold and the prepared.
Trade safe, trade smart, and ride the waves!
The Shark Water Trading Team
Disclaimer: This content is for educational and informational purposes only. Always do your own research and consult with a financial advisor before making investment decisions. Past performance does not guarantee future results.
