Trump Jettisons China After Finding New Alliance With Australia?

Trump once again has flip-flop when it comes to his policies-this time making a 180 u-turn when it comes to his strategy against China.

Barely 24 hours after announcing to reporters that he will be having a meeting with Chairman Xi in the weeks to come, Trump is now threatening to impose a tariff of up to 155% on Chinese goods if both countries do not reach a mutual agreement during the Asia-Pacific Economic Cooperation summit in Seoul.

The president’s latest remarks came during a joint press conference with Australian Prime Minister Anthony Albanese, where the two leaders unveiled an $8.5 billion rare earth and critical minerals deal aimed at reducing Western dependence on China’s industrial supply chains.

Both nations will contribute $1 billion over the next six months to strengthen access to rare earths — essential for defense, aerospace, and electric vehicle manufacturing. Trump framing the move as part of a broader geopolitical strategy, saying

“The United States is done depending on Beijing for what keeps our economy strong and our nation safe.”

But the timing of the announcement, paired with the tariff threat, sent shockwaves through global markets. Within 24 hours, over $329 million in crypto positions were liquidated, according to CoinGlass data. Bitcoin dropped to around $107,800, and Ethereum fell below $3,900, wiping out the week’s gains as investors fled risk assets amid fears of a new trade war.

Tariff Shock Mixed With Doubts Regarding The Upcoming Negotiation

The proposed 155% tariff marks a major escalation of Trump’s already aggressive trade policy. It adds to existing 55% duties reimposed earlier this year, along with new export restrictions on advanced software and technology announced on October 11. Analysts warn that this series of measures could trigger a broader global slowdown if trade relations continue to unravel.

More than 1.6 million traders were liquidated in a single day, amounting to $19.3 billion in losses — the largest liquidation event in crypto history. Market analysts now view $107,000 for Bitcoin and $3,800 for Ethereum as crucial support levels, with potential downside risk if the standoff worsens. One trader on X warned

“If Bitcoin loses the $107,000 level, it could drop toward $100,000.”

Trump most recent comment was met with harsh backlash from Beijing, with the Chinese foreign ministry dismissed Trump’s remarks as “not the proper way to engage,” signaling that the tariff threats may backfire ahead of the planned APEC meeting.

Meanwhile, Beijing quietly replaced its top trade negotiator, Li Chenggang, with deputy trade representative Li Yongjie — a move analysts interpret as a sign of internal recalibration before talks resume.

Despite his harsh tone, Trump insisted that a deal with Xi remains within reach, saying,

“I think when we finish our meetings in South Korea, China and I will have a really fair and really great trade deal together.”

Treasury Secretary Scott Bessent also confirmed that preliminary discussions could take place in Malaysia to “narrow differences” before the summit.

Economic Repercussions and Trump’s Political Calculus

The economic consequences of Trump’s shifting trade stance are already evident. Global companies have reported over $35 billion in tariff-related costs this year alone. While tariff revenues have helped trim the U.S. budget deficit to $1.78 trillion, economists caution that American consumers are footing the bill through higher import prices and inflationary pressures.

Still, Trump’s unpredictability remains both his trademark and his risk. His sudden tariff threat — coming just after a conciliatory statement toward Xi — underscores how U.S. trade policy under his leadership often mirrors his own political rhythm: reactive, tactical, and driven by short-term leverage.

For markets, this volatility has a cost. Each shift in tone from the White House triggers massive moves across equities, commodities, and crypto — suggesting that, under Trump, the line between diplomacy and disruption remains as blurred as ever.