Investment Strategy Amid Trade Tensions: A Step-by-Step Analysis

According to Foresight News, The Kobeissi Letter recently outlined a strategy that has proven effective for investors over the past ten months, particularly during periods of trade tension. This strategy's success this year is attributed to its adherence to specific steps during such times. The process begins with U.S. President Donald Trump making ambiguous statements suggesting potential tariffs on certain countries or industries, leading to a market downturn. Subsequently, Trump announces a significant increase in tariff rates, often exceeding 50%, causing market turmoil and shaking out weak positions. As the market dips, opportunistic buyers step in, but a false rebound results in stock prices hitting new lows, prompting savvy investors to start purchasing. Following the Friday market close, President Trump intensifies pressure by imposing additional tariffs. On Saturday, the targeted entities typically respond or comment on the new tariffs. By Sunday, before futures open, Trump issues a statement indicating efforts to find a resolution. Futures open sharply higher at 6 p.m. Eastern Time on Sunday but lose momentum after Monday's market opening. On Monday, Treasury Secretary Besent appears on live television to reassure investors. Over the next two to four weeks, various members of the Trump administration engage in discussions to reach a trade agreement. Finally, Trump announces a new trade deal, leading to record highs in the stock market. The cycle then repeats from the first step. The Kobeissi Letter notes that the process is currently at the ninth step.