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Since President Donald Trump returned to the White House in January 2025, his second-term policies have significantly reshaped the U.S. energy landscape, causing ripples across global markets. A sharp pivot in energy strategies, intensified trade disputes, and heightened geopolitical risks are creating complex market dynamics that traders must navigate carefully. At this intersection of factors, traders require crucial insights into how to approach the evolving market environment.
Trade Tensions: Implications for U.S. Assets
The aggressive tariff policies have triggered significant global market volatility, aimed at protecting U.S. economic interests. So far, his administration has enacted tariffs on specific countries and commodities, with some tariffs reaching as high as 50%. Track tariffs by governments and industry sector here.
These threats and measures have impacted trade relations with major partners, from the EU, to China and Canada, creating notable domestic effects as well on U.S. market sentiment.
Market fluctuations are amplified with every word Trump speaks, such as recent tariffs on European nation Greenland, has highlighted strained trade deal and unstable global stock markets.
Meanwhile, legal battles over the legitimacy of the tariffs continue to create uncertainty, with the U.S. Supreme Court set to rule on the constitutionality of the tariffs. Trade agreements, such as those with China and the EU, have seen temporary truce periods, but remain an open book.
As tariffs increase on critical materials like steel, aluminum, and copper, U.S. manufacturing and energy costs rise, potentially limiting growth while creating a more unpredictable investment landscape. For traders, these developments signal the need for heightened caution onsectors exposed to tariff impacts and ongoing trade war rhetoric.
Energy Policy Shifts: Fossil Fuels, Nuclear, and Renewables
Hours after taking office last January, Trump signed 26 executive orders —more than any other president in U.S. history had signed on their first day. His executive order, Unleashing American Energy, reversed Biden-era policies on climate protection and opened vast expanses of federal land to drilling.
But markets don’t always follow politics in a straight line. While federal backing for renewables has softened, solar photovoltaic (PV) remains the dominant technology, expected to make up 61.7% of power market investments between 2025 and 2030. Despite policy rollbacks, the underlying economics of solar, with decreasing costs and robust long-term growth, continue to make it the cornerstone of the energy transition.
The percentage of power market investments by technology, 2025–2030
Source: Global Data
While solar shines, wind energy faces challenges, especially offshore projects, due to regulatory delays and tariffs. However, onshore wind remains a key player, contributing 15.7% of energy investments. Natural gas and nuclear have benefited from Trump’s energy dominance agenda, with gas gaining from streamlined permitting and nuclear seeing renewed focus to enhance energy security and meet rising demand.
Trump’s tariffs have had a significant impact on both fossil fuels and renewables, especially solar, where project costs have increased by up to 54%. Despite these challenges, energy storage has emerged as a resilient sector, vital for grid stability as data centres drive increasing power demand. For traders, solar and energy storage present growth opportunities, while natural gas and nuclear remain key sectors, though material costs should be closely monitored.
Bitcoin vs. Gold: A Modern-Day Battle for Safe-Haven Status
In recent months, Bitcoin and gold have reacted differently to global economic turmoil. Gold has surged to a record high, surpassing 5k per ounce in January 2026, driven by concerns over inflation, U.S. dollar weakness, and geopolitical tensions. On the other hand, Bitcoin has seen a sharp decline, dropping from $96,000 to $89,000 to start of 2026, reflecting its ambiguity in times of indecision.
Gold continues to prove itself as a reliable safe-haven asset, particularly during periods of high inflation and market instability. Its consistent performance in protecting wealth during volatile times reinforces its position as a safe store of value. It is also predicted by Goldman Sachs that gold will rise to $5,400/oz by the end of 2026
While Bitcoin is often dubbed “digital gold”, but its safe-haven role is still unproven. It tends to swing more like a risk-on asset, with price moves driven by liquidity, sentiment, and fast-changing market narratives rather than stable defensive demand.
For traders, the key is recognising how differently these two assets behave when risk sentiment shifts. Gold often strengthens when uncertainty rises, while Bitcoin can react more sharply to liquidity and momentum flows. To stay ahead of the next move, monitor both closely using VT Markets’ real-time charts, market insights, and Economic Calendar, especially around inflation data, rate decisions, and geopolitical headlines.
For traders, a diversified portfolio that includes Gold and Bitcoin may help balance risk and reward, providing opportunities in both traditional and digital markets.
U.S. Stock Market Outlook
Global markets are facing renewed pressure as geopolitical tensions and tariff threats return under President Donald Trump’s second term.
Investors are increasingly concerned that the volatility caused by potential trade wars—especially with Europe over Greenland—could lead to more lasting damage this time, rather than the quick rebounds markets have grown used to.
Following Trump’s renewed tariff threats, stocks, U.S. Treasuries, and the dollar all sold off, signalling a broader “Sell America” trend. The S&P 500 dropped 2.1% in one day, its biggest fall in over three months, while dip-buyers stayed away. High market valuations after several strong years have made stocks more vulnerable to bad news.
Source: Reuters
As shown in the chart, while U.S. stocks have climbed under Trump’s second term, the performance has been notably lower than during his first term.
The renewed volatility, particularly around the Greenland dispute and the potential for tariffs, has contributed to a more turbulent market path. The dollar has also faced a rocky period, as indicated by the chart’s downward trend. Despite this, U.S. stocks have shown resilience but remain vulnerable to further geopolitical risks and tariff fluctuations.
Investors stay vigilant because the selloff spreads across multiple asset classes, creating new definitions of U.S. market safety. VT Markets is a multi-asset broker, diversify your portfolio with us in this new market rhythm.
However, many investors are still holding it out during this TACO trade turbulence, in which Trump often escalates threats but later backs down.
This possibility is keeping traders from aggressively selling, and any deeper market drop could still attract bargain hunters. Navigating this environment requires a careful approach. While there are opportunities for profit during stock rebounds, it’s essential to remain cautious and diversify portfolios.
The ongoing tariff threats, the unpredictability of geopolitical risks, and the reduced foreign investment flows could quickly shift the market’s trajectory. Monitoring key market indicators such as Treasury yields and the U.S. dollar index will be crucial for assessing potential shifts in market dynamics.
Conclusion
Traders will need to adjust strategies in seconds and days for both long-term trends and short-term market shifts. Stay up to date on Trump’s next move in this economic event to monitor how policy changes and market sentiment move the lines.
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