Where It Began: Liberation Day Fallout, Part IV – Prelude
A Young News Trading Specialist Navigates The Day That Started It All.
Read Part I: (Monday 7 April Trading Action)
Read Part II: (Tuesday 8 April Trading Action)
Read Part III: (Wednesday 9 April Trading Action)
Across the AXIA trading desks.
Wednesday 2 April 2025.
London, England.
But they wait and wait and… wait. In the lead-up to the Wednesday 2nd April ‘Liberation Day’ announcement, or any time you look back at the charts on a big day or week, you won’t forget the pains—whatIcould’amade!—but you will always forget the tedium. Really now!—would it not be respectable, feasible, guaranteed, there would be a leak, or headline or… something? Monday news? Nope. Tuesday source, surely! Neither.
And now these traders are here on Wednesday, these ten or so, on the first floor in London, waiting for the announcement scheduled for the evening. But they are cautious—hyped, indeed—yet concerned about the chances one is afforded to do absolute ring, as they say. With the entire market hanging on today’s event, the focus and attention and the way the markets have traded on the possibility of resetting global trade entirely, with whoinnameachrist knows what second and third order effects it will have?
And, more importantly, at which point will the market decide to look forward, very forward, or not look further than the next day? To be as optimistic as a 30-year bond, one moment, and as pessimistic as a 2-year note the next. Or is it the other way around? For these traders, this relatively risk-seeking, risk-eager group who refuse to downplay events, no matter their likelihood, are now prioritising caution. But then the E.U. session comes and goes; it’s relatively quiet on the news flow end. What are we expecting? Something like a 20% universal tariff? Targeted reciprocal, or bucketed?
“The most impressive thing about today,” this young trader says, “is how the hell we haven’t had any sources!” We’ve met him before; this curly-dark-haired, deep-voiced, freckled young trader has made his bones as a news trading specialist, hitting his first seven-figure year in 2022. Trump, he continues, is probably going to come out and ad-lib the thing live. He’s worked through seventeen variations of how, when, what the headlines will come down, and what he’d do: what markets, what size, and the sequence of it all. And he’s primed: the momentum in his career, from account growth to skill development, the confluence of the market story, and his story—about as wide as the tip of a pencil—it could always be a moment away from synchronising. That’s how it always is: the trader is always made in the next cycle, and he’s been building the bullets in the previous…
Plan adjustment: 9 p.m. nears in London, and the markets are thin, as the U.S. and E.U. cash sessions have closed out, and E.U. equity futures shut. And so the choice is made. Trade S&P futures out of all the equities and focus on one of the Treasuries. The 5-Year is our trader’s usual go-to. Short end is driving the market moves at the moment. So—it’s the 2-Year, or 5-Year—but the twos’ gets all caught up in the 2s10s and other spreads messing about. Fives’ is easier. If things went well, our trader would look at hitting Gold, Euro and maybe some Canadian dollar futures.
There is a relative consensus on the floor on what various outcomes could mean. But they are divided on the minutiae. As our trader sees it, the markets have priced and expect around 15-20% universal tariffs. The way the equities are still holding up relatively well, one can infer they expect Trump could back down again, and we’ll bid once more at curtain close. So: a 10% universal tariff is relatively dovish, yet 20% hawkish; markets will move accordingly. But 10-to-15%? What we doing with that… What if he exempts this… You’ve got to decide how you’ll act on these finer details of market pricing, our trader said later, as sometimes the day is often decided on the minutiae. Hence, the imperative is persistent and deep immersion with market flows, pricing, and news flow.
“Ladies, and gentlemen—the President of the United States!”
blares a voice from the speakers. Fanfare, Fanfare!—Prez T comes out, shakes someone’s hand and starts speaking; the markets roll, dip and ping around, but there is no real commitment or sustained flow. He goes on and on… Jesus man, say it! It was right here, in the Rose Garden, where Trump sanctioned China in July 2020 over its interference with Hong Kong’s autonomy, our trader remembers, and everyone expected tariffs to be added too, which didn’t happen. The pattern then? Chop-chop-chop—then the big, real move. Because Trump likes his preamble: “J.D., thank you, thank you—where are you, J.D.?” It’s all déjà vu: the Rose Garden again, the preamble and this damn death chop! Even if you smash the real move, you often make back only what you lost in the chop, so went the lesson for our trader, merely a year or so into his career then, to one day monetise this far better.
So he’s staying out of it this time—chopchopchop go the markets—yet our trader cranes over his keyboards; leaning forward from his chair, his face drawing closer to the screens: symptomatic of getting glued to the Spoo. What’s it trying to do? Where’s Trump leading us? Maybe… if it blips up on nothing, I could sell it for a downside move if he’s not said anything. The markets hang on the President’s every word, some traders hit various markets mid-sentence, front-running the traders hitting the end of the sentence. You never know… says the trader who just pinged the S&P. But our trader is still waiting.
Then!—one of his screens featuring a little box where headlines drop down flashes—he glances—“ten percent universal tariff!” our trader shouts to the floor——
———Instantly! Lift the S&P, hit the 5-Year, hit Gold!——
——Holy Shi-HolySh—You have to be in this! This is huge! Lift the Spoos! Need to be in it! clickclickclick—— the price ladders are already screaming; max speed!——
——“Ten percent tariff!—ten percent!—ten percent!” the traders shout to one another over the alerts and Trump’s speech at full blast over the speakers. Huge—this is big mate! The move was so fast that as our trader tried to lift 240 lots, one of his big clips got left behind; down below as a limit order, he managed to get the other 160 lots at-market. He was already in another 300-or-so lots in the 5-Year and 30 in Gold.
The S&P, the ol’Spoo, bids higher—teleports, practically—as the 5-Year and Gold futures collapse off the screens. Get the charts; get the charts! Shit! Spoos is already there. Our trader starts to scale out his S&P as it hit some pre-drawn levels; the markets are so thin they can snap back even further than they can run forward. Clickclickclick—outoutout—he scales out of S&P and the 5 Year; then sold Gold again. But this time he went offside. That’s weird… he sells some more, but Gold bids against him. This is going to get messy…
In the background, Trump is still going on about… something. But none of this flow had come from him. Somewhere, in between all of this, the headlines were attributed to the Wall Street Journal through the newswires while Trump was speaking live. ‘U.S. To Impose 10% Across-The-Board Tariff on All Imports, President Trump Says—WSJ’ was the first headline to drop, which, in combination with the two other headlines that followed, meant that, from all that had been said and done, it would be a large step down from all this financial, economic sabre-rattling. So: good news! Buy S&P! And another good reason to start getting out of positions, our trader thought, as nothing has yet been said and done, and Trump is still a few phrases away from your best or worst trading day. Eventually, our trader gave up his Gold position, which was a relatively small loser. Anyway, the order book was too thin to trade with any meaningful size. Now, Trump has started talking specifics on tariffs and rates…
…now he’s mentioned China!... the rate they’ve escalated, and how the U.S. would charge them half of that. That doesn’t make sense. Trump keeps saying reciprocal, but WSJ just said they are doing a universal tariff…
The Little Big Chart
“Could you bring it out, Howard?”
Then, twenty or so minutes into the announcement, Commerce Sec Lutnik brings over a very official-looking board and hands it over to our main man.
“If you look at that—China, first row,” Trump continues, “China: sixty-seven percent... so we’re going to be charging a reciprocal tariff of thirty-four percent.” 34! Not 10, 15, 20—this is way above the most hawkish expectations! 20% was the worst case, and we traded on the good, dovish case—now suddenly we have to price the extra-worst scenario? And for each country individually? Look at the list he’s holding up! The plot twist is here. “So how can anybody be upset?” continues Trump.
Instantly! Our trader hits the S&P bids with a full clip and lifts three big clips in the 5-Year—mate, this is crazy! After we traded on the dovish, now invalidated headline, we just got an extra hawkish confirmation! So the WSJ move is wrong; everyone positioned on that is wrong, too. But the markets all... hang for a while longer. Clickclickclick—do more Spoos!Oh-shi—order error?! A moment like this just snapped our trader out of focus; caught between figuring out this error and listening again to Trump—he’s listing every country now! “… you think of European Union—very friendly—they rip us off!”
Yet the flows now are different, not as quick as the WSJ upside, just pulses, bits of choppy flow pushing the S&P lower. No price confirmation that our trader wants to see. Yet the floor helps to commit: This is huge! It has to go!—the traders roar. He holds, but doesn’t add in. Can I do anything else? Euro? No, its correlations are just broken now. Just hold what you have!
The S&P holds and holds a small range, but then everything cracks; the S&P offers down the page, the 5-Year bids. Our trader tries to manage his positions more dynamically, scaling out on big flushes and adding some more as the S&P bids back up. He scales out some more out of the 5-year, but over the next twenty minutes or so, he’s done. The floor starts to discuss holding what they have left until the close. But our trader replies he’s completely out.
He glances at one of his screens: best day and best trade—well over a quarter of a million dollars. It took a while to push this milestone, but little did he know he would smash this personal record and set others in the fortnight to come. That’s how it is for the long volatility trader: the best and worst days come in clusters.
Reflections
The next evening, our trader glances at his phone: Asymmetrist has messaged him. They want all the details! And he obliged, only to receive a raft of follow-ups:
Did the thin markets make you execute any differently?
“It made me a lot more cautious. I knew the markets would be pinging around much more; it was a hyped event, and everyone was watching. Thin markets meant I wasn’t pre-positioning into it, so I wouldn’t be trading anything I didn’t think would be genuinely big. The fact that it was thin made me get out faster. I wanted to trade more size across more products, but half the products were already closed because of the time of day. Yet, execution-wise, it was very similar to how I would’ve executed anyway—but I wasn’t positioned beforehand. I only wanted to take positions on a proper outlier.”
How do you decide how many clips? Is there a scale or gut-feel process?
“It’s how much I think I can get off! If I can do a couple of clips before the market moves, that’s fine. Sometimes I can’t clip before it goes, or if I’ve been too slow to get to the market, the clips I get off will change. In a massive outlier, I’ll do as much as possible. But in my head… did I want 400 Spoos on? Yeah, obviously—in hindsight it would’ve been a great trade. But 400 Spoos, when we are bid and offered like 15 lots? That 400 moves the market wild! And then I’ve got to get out. If I’m wrong or misjudged… there’s a lot that can go wrong. In my head, I need to manage my risk. And if I don’t? Too much size becomes more of a detriment than a positive.”
How did you physically manage switching between ES [S&P Futures: CME], ZF [U.S. 5-Year Note Futures: CBOT] and Gold [Futures: COMEX]?
“I just had them all [price ladders] next to each other, really—so it wasn’t too difficult. I already had those products in mind to hit. Just those:
If it were small or in line, I’d only hit ES.
If it were slightly out of line, I’d go ES and ZF.
If it was big out of line, then ES, ZF, and Gold.
I had all three charts and ladders set up. It was more of a prep game beforehand—not a dynamic, on-the-fly decision. That made all the difference.”
You said the day should have been twice as big—why didn’t you size up? Was there doubt?
“It wasn’t doubt… I clipped in and wanted to be bigger. But I got a couple of rejections on the ladder—it threw me out of the zone. I got the size I wanted in ZF, but then got caught up in the fact that Trump was still talking. I heard ‘China’—and yeah, that was big—but then I realised he was listing every country. My brain was caught between Trump and the rejected orders… it pulled me out of the moment. And at that point it’s gone—market’s thin!
I really should’ve just added and accepted the risk of doing that. But I didn’t hit it. Maybe I thought: I’ve got a position on, just ride it! I did manage it well, but it could’ve been more P&L if I’d accepted the order error and fought to get another clip in somehow.”
What would you have done differently?
“I wouldn’t have fought Gold as much as I did. It was quite obvious what it would do—it didn’t—so I should’ve just given up on it faster. Because other markets were very violent, and Gold wasn’t—that was a warning. To the [34% tariff] downside? I’d have taken more size in equities, and I’d have bought Gold. By then, Gold was super strong and refused to trade lower. That was the big thing, I think.”
How did you feel after the trade?
“I was not massively buzzed going into [the event]. I was happy as it ended up as my best day; a really good day. But I don’t get the same kick out of that anymore… it’s a bit of a shame. I’m annoyed at how I handled the downside—it wasn’t good enough. But at the same time, I was reinvigorated. It reminded me why I love trading—there’s real satisfaction when something like this comes together.”
Read Part I: (Monday 7 April Trading Action)
Read Part II: (Tuesday 8 April Trading Action)
Read Part III: (Wednesday 9 April Trading Action)
Read Much More About These Special Traders!
Much more to be found in
Traders of Our Time: Navigating the Market’s Impossible Landscape.
10 Elite Traders.
125 Years of Mastery.
500 Pages of
Lessons, Practices
and Original Stories
For You To Become the Trader
You Always Wanted To Be.
Acknowledgements, Permissions & Disclaimer
Grateful acknowledgment to AXIA for granting access to one of their traders, and his contributions and efforts towards this article.
The first photograph of President Donald Trump at the lectern is a public domain image originally released by the White House, retrieved via Flickr. Modified from the original. Public domain. Link to file.
The second photograph of President Donald Trump with the tariff chart is a public domain image originally released by the White House, retrieved via Wikimedia Commons. Modified from the original. Public domain. Retrieved from Wikimedia Commons: Link to file.
Disclaimer: Do Not Do Stupid Financial Decisions. This Is Not A Game.
.jpg?uselang=en#Licensing){kind=link}