What does "TACO Trading" really mean? The profit secret for Trump discovered by Wall Street

Wall Street traders have discovered an interesting phenomenon and named it—the TACO trade. The meaning of this term is straightforward and blunt: Trump, Always, Cancel Order. In short, the TACO trade refers to the market pattern of betting that Trump will back down after announcing aggressive policies.

The Three-Step Logic of TACO—From Tariff Declarations to Market Rebounds

The existence of the TACO trade stems from observable clear patterns. First, Trump suddenly announces an aggressive tariff measure or trade sanctions on social media, often dropping a bomb in the market—stocks fall, cryptocurrencies decline. Then, at the peak of market panic, official news quickly follows: negotiations are still ongoing, and a conference call will be held to seek a solution. Finally, as an agreement is reached or policies are eased, financial markets reverse and rise.

For investors who understand this rhythm, the TACO trade involves buying the dip during the initial panic and then waiting for the market to profit from the rebound in the third phase.

From 103,000 to 70.96K—How Bitcoin Validates the TACO Pattern

Recent events have provided a perfect textbook case for the TACO trade. The Trump administration announced broader sanctions against China, focusing on Chinese tech companies. After this news was released, Bitcoin’s price dropped to around $103,000.

But the story didn’t end there. The Trump administration then indicated willingness to negotiate with China, even inviting all countries to submit their best offers, giving parties until July 8 for negotiations. These positive signals sparked hope in the market, and Bitcoin’s price began to rebound. According to the latest data, Bitcoin has recovered to the $70.96K level.

Why Investors Bet That Trump Will “Back Down”

The reason the TACO trade is popular on Wall Street is that it is based on repeatable historical patterns. Whenever policy bombs trigger market declines, subsequent negotiation signals and agreement signings often lead to a reverse rally. This is not guesswork but based on a series of events that have repeatedly occurred.

Investors dare to buy the dip during policy announcement panic because they believe in the predictability of this pattern. In other words, the TACO trade is not just a satirical concept but also represents investors’ precise grasp of market laws—seeking certainty in profits amid the “false alarm” of policy.