The trade war between the U.S. and China has escalated with both sides adding additional tariffs to each others’ import. China retaliated with tariffs on US$75 billion of U.S. import and Trump announced an additional 5% duty on US$550 billion of Chinese import. This further exacerbated a prolong trade war between the two largest economies in the world.
However, despite the escalation, all 3 US indices did not make a lower low than the low on the 6th of Aug 2019. Neither is the market fearful of this renewed trade war! The VIX index is lower than the reading on the 5th of Aug 2019.
Could this be the correction of the 2019 rally? Has the correction ended?