- The agreement in one minute
- What changed: Starting 14 May 2025 the United States will drop its blanket tariff on Chinese imports to 30 percent (from 145 percent). China will cut its levy on US goods to 10 percent (from 125 percent). The reprieve expires after 90 days, that’s around 12 August 2025, unless a broader deal is reached. euronews
- A separate 20 percent fentanyl-related surcharge remains, and sector-specific duties on cars, steel and semiconductors are untouched.
- How markets reacted in the first 24 hours
| Asset class | Immediate move | Take-away |
| US equities | Dow +2.8 percent (≈ +1 100 pts), Nasdaq +20 percent from April low | Relief rally signals restored risk appetite but also shows how crowded shorts were. (WSJ) |
| Treasuries | 10-year yield spiked to 4.441 percent, 2-year above 4 percent | Rotation out of safety; higher real yields could cap equity upside later. (Barron’s) |
| Dollar & Yuan | Modest dollar strength as Fed-cut odds pushed to September | Rate-cut path repriced, watch DXY vs CNY through June. (Reuters) |
| Shipping & logistics stocks | Maersk, ZIM, Old Dominion, JBHT each +8 to 15 percent | Direct volume beneficiaries, quickest beta to trade-flow snapback. (Investor’s Business Daily) |
3. The three-phase trading map
| Phase | Approx. dates | Macro pulse | Strategy ideas |
|---|---|---|---|
| 1. Relief & positioning | 14 May – 31 May | Headlines still positive, inventories rebuild | Momentum swing: ride early winners (shipping, luxury, Chinese tech ADRs). Tight stops below Monday lows. |
| 2. Data & diplomacy | 1 Jun – 10 Jul | PMI, inflation and mid-round talks surface | Event gamma: long straddles on USD-CNY and copper ahead of each negotiation date; fade extremes. |
| 3. Expiry brinkmanship | 11 Jul – 12 Aug | Noise grows, will tariffs snap back? | Volatility harvest: sell 1-week vol spikes, hedge tail with cheap August S&P 500 puts. Crystal-clear exit rules. |
4. Asset-by-asset playbook
Equities
- Early-cycle cyclicals (machinery, transports) should keep leadership while macro surprises stay positive.
- Mega-cap tech rallies can overshoot; consider trimming into 15 percent pops because bond-yield pressure will re-emerge if negotiations stall. WSJBarron’s
Commodities
- Copper and iron ore tend to move 2-3 weeks after import tariffs change. Look for a follow-through bid if June Chinese PMI turns up.
- Gold sold off on day one; use the first Fed-cut repricing wobble to add back long gold if bond yields close above 4.5 percent. Barron’s
FX
- USD-JPY has the cleanest risk-on correlation, pair it with short CHF as a relative-value trade during Phase 1.
- Watch offshore yuan (CNH): a break below 7.05 signals capital inflows returning; fade rallies above 7.25 if talks sour.
Crypto
- Historical beta suggests Bitcoin gains roughly 0.8 percent for each 1 percent move in the S&P during tariff-relief windows. Expect altcoins to outperform in Phase 1 but underperform once bond yields climb. Use relative strength screens to rotate fast.
5. Risk radar
| Risk | Flag to watch | Hedge |
| Talks collapse | Leaked comments from either trade team | Long VIX August 20 calls |
| Surprise Fed hawkishness | CPI prints above 0.4 percent m-o-m | Ultra-long bond puts |
| Geopolitics (Taiwan / tech sanctions) | Commerce Department license revocations | Long USD-KRW |
6. Bottom line for Ohirex traders
The 90-day tariff truce has restarted the risk cycle, but it is a rental rally, not a new paradigm. Exploit the early liquidity rush, then pivot to volatility extraction as uncertainty creeps back in July. Keep time horizons tight, position sizes sane, and let price, not emotion, tell you when the story changes.
Happy trading and stay nimble.
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