China vs US : Markets on the EDGE?

Markets Overview

The last 24 hours have delivered some deeply unsettling developments globally. As of 12th October, China has effectively locked horns with the United States, triggering a sharp escalation of tension. The U.S. is reportedly considering a 100% tariff on Chinese goods, and in retaliation, China has hinted at cutting off exports of rare earth metals, which are critical to global semiconductor and tech supply chains. On top of that, the crypto market is facing its own shockwave—Bitcoin is crashing amid rumors that Chinese authorities are offloading confiscated Bitcoin holdings into the market. These are not isolated signals. When one part of the global financial structure starts showing cracks—be it crypto, commodities, or equities—it often sets off a domino effect across asset classes.

U.S. markets too saw a sharp fall on Friday, one of the steepest in recent sessions, hinting that stress is building up under the surface. The coming week is likely to be volatile, and leveraged traders need to be extremely cautious. This is a phase where sticking to a disciplined strategy is critical, rather than reacting emotionally to headlines.

On the domestic front, the Nifty’s daily structure was actually looking quite strong before this global turbulence began. Over the last seven sessions, the index climbed steadily from 24,600 to 25,285, delivering a 1.57% weekly gain, which by all standards is a healthy performance. The market showed resilience, buying every dip and refusing to break below its established support zones. The price action suggested that momentum was building for a potential technical breakout.

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As the week comes to an end, many people seem relieved that there has been no fresh tantrum from the US so far. Donald Trump, however, has lost the race for the Nobel Peace Prize, so there’s always that worry that he might react in some unpredictable way over the weekend — something we’ll find out by Monday.

The good news from yesterday was that FIIs finally turned buyers after a very long time, and the markets welcomed that move with cheer. Whether this buying will continue as a new trend or it’s just a one-day event, we’ll know only in the coming days.

Rebalance Update for the week