Buying SPX on positive resolution of US and Canada trade disagreements

President Donald Trump creates such widespread economic and political uncertainty with his chaotic trade policies, so it becomes more difficult to overcome with each passing day.

On Tuesday, markets were rattled by Donald Trump's repeated threats to impose tariffs on energy, steel and aluminum from Canada and destroy the country's auto industry. On Wednesday, the US president imposed tariffs on steel and aluminum imported from around the world. This may lead to higher prices on a host of consumer and industrial goods for Americans. Europe immediately retaliated by increasing pressure on a number of American industries.

Wall Street is nervous about the damage Trump's policies may cause to America's still strong but already vulnerable economy. The Nasdaq entered a correction, down 10% from its recent high, and the S&P 500 is close to the edge of correction territory.

Trump's advisers, including Commerce Secretary Howard Lutnick, Treasury Secretary Scott Bessent and National Economic Council Director Kevin Hassett, provided Trump with many options on how to keep the US economy strong and get out of the situation the US stock market is now in.

At times, Trump seemed to recognize these risks and was constructive. He hit the brakes twice on Canada and Mexico's tariff plans, pushed back the estimated effective date of reciprocal dollar-for-dollar tariffs, and last weekend postponed the tariffs on dairy products and lumber that would come into force by now.

And last Tuesday, Canadian and US officials agreed to meet later this week to discuss their trade disagreements, potentially easing the escalating trade war. If the outcome of the meeting is a cooling of aggressive trade initiatives, it would be a strong bullish signal for the stock market, including the S&P500 broad market index.

The overall recommendation is to buy the S&P 500 provided trade differences between the US and Canada are resolved at a meeting later this week.

Profits should be taken at the level of 5930.0. A Stop loss could be set at the level of 5300.0. 

The volume of the opened position should be set in such a way that the value of a possible loss, fixed with the help of a protective Stop loss order, is no more than 1% of your deposit funds.