The S&P 500 recently faced a sharp decline, with many rushing to blame renewed trade war tensions under President Trump's second term. But is this downturn truly a political reaction — or was it already baked into the market’s DNA?
A deeper dive using Elliott Wave Theory suggests something far more structural: the recent fall is part of a broader wave pattern, and the real crash hasn’t even begun.
A Look Back: How the Market Reacted to Tariffs in Trump's First Term
During Trump’s first presidency:
Despite this turbulence, the market rebounded sharply, climbing 44% post-trade war — forming a textbook Wave 5 extension.
This historical context is crucial: event-based declines often align with technical wave structures, not random panic.
Why the Market Fell Now (and Not Earlier)
Trump’s second term victory wasn’t unexpected. Neither was his return to tariff-heavy policies.
So why didn’t the market react earlier?
📉 Because this isn’t about Tariffs. It’s about Wave 4.
The current market downturn coincides with the natural Wave 4 correction of a multi-decade Elliott Wave cycle. This phase is often sharp and emotional — yet incomplete. The final Wave 5 rally is still ahead, possibly pushing the index to new highs above 7,000.
The Calm Before the Storm: What Comes After Wave 5
Following the euphoric rally of Wave 5, the market is expected to face a massive correction — Wave II — projected to be as severe as the 2008-09 financial crisis, if not worse.
Potential triggers:
Conclusion: Trump’s Triumph or Tragedy?
This wave analysis raises the question: will Trump’s second term be remembered for a market rally or a devastating crash?
The answer may be both.
✅ Short-term triumph via Wave 5
⚠️ Long-term tragedy via Wave II
The smart investor will ride the wave — but also prepare for the fall.
Key Takeaways:
A deeper dive using Elliott Wave Theory suggests something far more structural: the recent fall is part of a broader wave pattern, and the real crash hasn’t even begun.
A Look Back: How the Market Reacted to Tariffs in Trump's First Term
During Trump’s first presidency:
Despite this turbulence, the market rebounded sharply, climbing 44% post-trade war — forming a textbook Wave 5 extension.
This historical context is crucial: event-based declines often align with technical wave structures, not random panic.
Why the Market Fell Now (and Not Earlier)
Trump’s second term victory wasn’t unexpected. Neither was his return to tariff-heavy policies.
So why didn’t the market react earlier?
📉 Because this isn’t about Tariffs. It’s about Wave 4.
The current market downturn coincides with the natural Wave 4 correction of a multi-decade Elliott Wave cycle. This phase is often sharp and emotional — yet incomplete. The final Wave 5 rally is still ahead, possibly pushing the index to new highs above 7,000.
The Calm Before the Storm: What Comes After Wave 5
Following the euphoric rally of Wave 5, the market is expected to face a massive correction — Wave II — projected to be as severe as the 2008-09 financial crisis, if not worse.
Potential triggers:
Conclusion: Trump’s Triumph or Tragedy?
This wave analysis raises the question: will Trump’s second term be remembered for a market rally or a devastating crash?
The answer may be both.
✅ Short-term triumph via Wave 5
⚠️ Long-term tragedy via Wave II
The smart investor will ride the wave — but also prepare for the fall.
Key Takeaways:
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.