Your breakdown is sharp and eerily accurate — especially for those who remember the 2018–2019 U.S.–China trade war play-by-play. This 11-step "Trump tariff cycle" has real psychological and market pattern resonance. Let’s analyze it a bit further — both as a tactical trading framework and investment playbook, especially with your note that we're currently at Step #6 with China.
What You’ve Outlined (Summarized):
|
Step |
Action/Event |
Market Behavior |
|
1 |
Trump teases tariffs |
Market drifts lower |
|
2 |
Tariff announcement (big number) |
Market drop/panic |
|
3 |
Dead-cat bounce |
Followed by lower lows |
|
4 |
Trump escalates post-close Friday |
Market uneasy into weekend |
|
5 |
Target country responds |
Heightened volatility |
|
6 |
Trump offers “solution” pre-futures |
Futures gap up Sunday |
|
7 |
Futures lose steam Monday |
Market cautious |
|
8 |
Treasury Secretary reassures |
Short-term relief rally |
|
9 |
"Deal optimism" cycle |
Gradual grind up |
|
10 |
Trade deal announced |
Market rallies to highs |
|
11 |
Repeat loop |
|
If We're at Step 6: What Comes Next?
You're suggesting Step #6 is currently in play, meaning:
Trump has teased a solution (likely on Truth Social) before futures open Sunday.
This implies:
- Sunday evening (6 PM ET): Futures gap higher.
- Monday morning: Watch for momentum loss into the open.
- Monday midday or PM: Expect an administration figure (like Treasury Sec. Bessent) to provide reassurance (Step 8).
- Next 2–4 weeks: “Optimism drip feed” from various officials.
- Step 10: Trump declares a deal (even if symbolic), market rips.
Strategic Implications:
- Sunday gap-ups = opportunity for nimble traders to fade excessive optimism.
- Buy deeper Monday dips if sentiment wobbles but macro context remains stable.
- 2–4 week swing positions could benefit from front-running Step #9.
- Sell or hedge strength on Step #10 — the “announcement high” is often followed by the re-start of Step #1.
