Trump postpones China’s tariff deadlines by 90 days, sidestepping immediate expiration and controversy
by VT Markets
/
Aug 11, 2025
Trump has signed an executive order that extends the deadline for China tariffs by 90 days, now set to expire on November 9. The original deadline was due tomorrow, but this extension changes the timeline.
This 90-day extension lowers an important market risk. Investors’ immediate fears are easing, which should lead to a significant decrease in implied volatility.
Impact on Volatility Index
We expect the CBOE Volatility Index, or VIX, which has been high due to concerns about the deadline, to drop toward its recent lows. We’ve seen this pattern before during the trade disputes of 2018-2019, where delays in tariffs often caused sharp declines in volatility. So, selling near-term volatility could be a smart move in the upcoming weeks.
This relief may spark a rally in equity indices, especially those tied closely to global trade. Companies in the semiconductor and industrial sectors, which have been feeling the effects of supply chain issues, are likely to gain the most from this temporary stability. Earlier data shows that U.S. imports from China are crucial to the economy, highlighting how sensitive the market is to this situation.
For specific trades, we are considering buying call options on the Nasdaq 100 and key tech stocks. The expected decline in implied volatility makes these options cheaper than they were last week. Another strategy to profit is by selling out-of-the-money put spreads on broad market ETFs, which takes advantage of both lower volatility and a stable-to-rising market.
Future Market Implications
While the short-term outlook is bright, this extension is merely a delay, not a solution. The tariff threat will return as the new November 9 deadline approaches. This creates an opportunity to prepare for renewed uncertainty later this fall, possibly by purchasing longer-dated volatility options once the current calm sets in.
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by VT Markets
Aug 11, 2025
Insights 
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