Panic in the White House: China Begins to Mirror U.S. Actions

[Redator]

"China is an adversary of the entire world." This statement, made on Wednesday evening by U.S. Treasury Secretary Scott Bessent, highlights the escalating tensions surrounding China. The controversy has intensified over the past week following Beijing's decision to tighten controls on the export of rare-earth metals. It remains unclear whether these "sanctions" will apply solely to the U.S. or to the global market. However, it is important to note that China leads the world in rare-earth metal production. According to Trump and Bessent, this gives Beijing the power to hold the entire world economy hostage.

Secretary Bessent stated that tightening export controls on rare-earth metals is not a proportional response to U.S. actions but rather an act of economic coercion affecting the whole world. In his view, Beijing is using hostile rhetoric that could compel global economies to sever ties with China. Although Bessent emphasized that neither the world nor the U.S. wants such a rupture, these signals from Beijing are pushing the international community toward that very outcome.

Bessent also criticized Chinese representative Li Chengang, accusing him of showing disrespect during a visit to Washington by issuing threats of global chaos. Notably, Bessent chose not to address the U.S. administration's own plans to impose 100% tariffs on Chinese imports—a figure that, according to some reports, could rise to 500% if China does not abandon its enhanced export control policy.

It is now clear that Washington strongly dislikes reciprocal tactics. While neither Trump nor Bessent hesitates to impose tariffs on half the world, the reaction is entirely different when other countries respond with restrictions of their own. The White House's concern is understandable: rare-earth metals are critical to the production of nearly all technological products. Modern electronics and even many categories of military equipment rely on these materials.

Political analysts believe China's move is a strategic preparation for the high-level negotiations scheduled for November between Donald Trump and Xi Jinping. Beijing is seeking to bolster its negotiating position to avoid what it sees as punitive tariffs. It must be acknowledged that China's hand in the negotiations is just as strong as America's. Also noteworthy is that Bessent spoke on behalf of "the entire world"—even though no other country has officially commented on Beijing's potential export restrictions. The U.S. continues to attempt to rally global allies in its stand against China.

EUR/USD Wave Structure:

Based on the current wave analysis of EUR/USD, the pair continues building an upward trend segment. The wave mapping remains entirely dependent on the news backdrop—particularly developments tied to Trump's decisions and the domestic and foreign policy of the current U.S. administration. Targets for the current trend segment could extend as far as the 1.2500 area. At present, we appear to be witnessing the completion of corrective wave 4, which is complex and drawn out. As a result, I continue to consider only long positions in the short term. By year-end, I anticipate the euro will reach the level of 1.2245, corresponding to the 200.0% Fibonacci.

GBP/USD Wave Structure:

The wave configuration of GBP/USD has shifted. We are still within an upward, impulsive trend segment, though its internal structure is becoming increasingly complex. Wave 4 is taking on a complicated three-wave form and is far more extended than wave 2. Currently, we are likely in the formation of another corrective three-wave pattern, which may soon be completed. If this assumption is correct, the currency pair could resume rising within the broader wave structure, with initial targets near the 1.3800–1.4000 range.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex patterns are harder to trade and more prone to changes.
2. If there is no clear understanding of market dynamics, it's better to stay out.
3. Absolute certainty in market direction is impossible. Always use protective Stop Loss orders.
4. Wave analysis can and should be combined with other forms of market analysis and trading strategies.

The material has been provided by InstaForex Company - www.instaforex.com