‘Buy the dip and sell the rips’ — stock traders keep counting on the ‘Trump put’

Uncertainty over global economic policy has spiked. In just the past week, stock investors were given a fright over changes to the AI ecosystem, the U.S. Federal Reserve and European Central Bank interest-rate decisions, earnings reports from the “Magnificent Seven” companies including Apple AAPL, Meta Platforms META, Microsoft MSFTand TeslaTSLA, along with a raft of Trump administration policy announcements and executive orders that surprised the market.

Is it any wonder that market volatility has arrived? As a consequence, it’s a tough time for trend followers because apparent established trends can quickly reverse themselves in this environment. As an example, the relative returns of price-momentum ETFs, which seek exposure to stocks that have gone up the most in the recent past, have been on a roller-coaster ride.