China’s not backing down this time.

They hit back at Trump’s latest tariff threats Tuesday with their own set of countermeasures, sanctioning the American units of a South Korean shipping company. 

This isn’t posturing — this is escalation. 

And if you think the market’s going to brush it off like it did in round one, you might want to take a second look.

Now traders are stuck trying to price in policy from two governments that aren’t flinching and a Fed that’s flying without a dashboard.

You read that right. 

We’re weeks into a government shutdown, and the normal stream of economic data — jobs, wages, manufacturing — has slowed to a drip. 

That’s a problem. 

Fed Chair Jerome Powell spoke Tuesday without really having the full picture in front of him. 

He said the economy is on a “somewhat firmer trajectory than expected,” but the job market is stuck in a low hiring/low firing mode and inflation is partly a result of tariff pressure. 

Because of those uncertainties, among others, the central bank plans to take a meeting-by-meeting approach to potential rate cuts. (It only has two left this year — one at the end of this month and one in December.)

And if you want to see just how confused markets are, look no further than crypto and gold. 

They should be moving together if this were purely a fear trade. 

Instead, gold’s catching a bid while Bitcoin’s sliding off. 

That tells you this isn’t just a knee-jerk reaction to China or the Fed. 

This is deeper. This is uncertainty with a capital “U.”

Then you’ve got earnings from the big banks — which should be the steadiest part of the market — but even those are being treated like landmines. 

Bottom line: There’s no clear signal out there right now, only noise.

So how do you trade when no one’s steering the ship?

Let’s discuss. 

First, the Fed

Start with Powell.

He’s expected to toe the line on interest rates — keep it steady, say a lot without saying much. 

But without jobs data or inflation numbers to lean on, it becomes a guessing game. 

That’s dangerous, especially when traders are already on edge about how aggressive the Fed might get in the next six months.

Now add China to the mix.

Tensions with China kicked into high gear last week after Trump threatened to slap a 100% tariff on Chinese goods starting Nov. 1. 

Beijing had been talking about tightening the screws on rare earth exports — and that’s no small thing. These minerals are critical to everything from semiconductors to defense tech. 

The fracas seemed to ease for a minute, but then things spiraled again this week. 

Static on Draft

Meanwhile, gold is doing what gold does by acting like a safety valve. 

But crypto is completely out of sync. 

That suggests traders aren’t just reacting to macro threats. They’re sorting out long-term plays vs. short-term noise. 

And crypto, for now, is seen as too speculative to hold during headline risk.

Bank earnings, meanwhile, are a wildcard.

Rates have moved higher over the past year, which should help the banks, but trading desks have struggled with low volatility and light volumes. 

Add in the shutdown, and even the big players are warning about tighter margins.

Head Down, Eyes Up

This is one of those weeks where staying out of trouble is just as important as making a great trade. 

When headlines move markets faster than fundamentals, you don’t guess. 

You wait, you watch, and you prepare for the moment the smoke clears.

Because it will clear — it always does.

And when it does, I’ll be ready. 

Hope you are too.

Stay street smart,
Jeff Zananiri

P.S. This is the kind of move Wall Street really doesn’t want you seeing.

We’ve spotted a hidden line inside certain stocks where price explodes — 2,500%* moves in a day aren’t rare here.

It’s called The Money Zone, and we’re breaking it down live today at 2 p.m. EST.

👉 Reserve your seat now before it’s gone.

*Past performance does not indicate future results. Results not typical.