The market has entered the "expectation disorder" phase, focusing on defense while waiting for opportunities.

1. Core Judgment

1. Non-linear policy path: Government tariff policies exhibit internal divisions and short-term fluctuations, making it difficult to establish long-term consistency. The repeated policy changes disrupt market confidence and reinforce the "noise-driven" characteristics of asset prices.

2. Soft and hard data divergence: Although hard data such as retail has been strong in the short term, soft data like consumer confidence has weakened across the board. This lagging effect resonates with policy disruptions, making it difficult for the market to accurately grasp the direction of macro fundamentals.

3. Pressure on central bank expectation management intensifies: The central bank's neutral yet hawkish statements aim to prevent the market from pricing in easing too soon. The current situation is that inflation is not stable, but there is pressure from fiscal policy to cut interest rates, and the core contradiction is becoming increasingly sharp.

2. Key Risk Outlook

1. Policy expectation confusion: The most important risk is not "how much tariffs will increase", but rather "no one knows what the next step will be", leading to a loss of policy credibility.

2. Market expectations become unanchored: If the market believes that the central bank will be "forced to ease" under high inflation/economic recession, it may lead to a "misalignment market" characterized by widening credit spreads and rising long-term interest rates.

3. The economy is on the brink of stagflation: hard data is temporarily masked by a buying spree effect, and the risk of real consumption slowing is accelerating.

3. Strategy Recommendations

1. Maintain defensive structure: Currently, there is a lack of systematic reasons to go long, and it is advised to avoid chasing highs and heavily investing in aggressive assets.

2. Focus on the structure of the yield curve: Once there is a mismatch with the short end declining and the long end rising, it will pose a double blow to overvalued and credit assets.

3. Maintain a bottom-line mindset and moderately reverse allocation: Volatility repricing will bring structural opportunities, but the premise is to control position and pace well.

4. Macroeconomic Review of This Week

1. Market Overview

This week, there are only 4 trading days, and the main stock indices continue to fluctuate downwards. The three major indices have continued to decline this week, with trade frictions combined with the central bank reiterating a "wait-and-see" stance, leading to overall weak market performance. Safe-haven asset gold continues to rise, reaching a historical high. In terms of commodities, oil has stopped falling and rebounded, while copper prices have slightly warmed up. The cryptocurrency Bitcoin continues to fluctuate within a narrow range, while other altcoins are generally weak.

2. Economic Data Analysis

2.1 Progress and Analysis of Tariffs

The government's divergence on the tariff issue is becoming increasingly evident: the finance and business sectors tend to moderate, while core trade hawks still insist on a hardline stance. The tariff policy itself lacks consistency, and its implementation path will present significant non-linearity and short-cycle fluctuations, becoming a persistent inducement for market volatility.

The goals of tariff policy contain internal contradictions, making it difficult to simultaneously achieve increased fiscal revenue, promote the return of manufacturing, suppress inflation, and alleviate trade deficits. This is more like a "political narrative tool" rather than a sustainable macroeconomic regulation method.

The most concerning risk is the inability of policies to remain stable and consistent, leading to a loss of trust in the market, which causes corporate decision-making to become short-term focused and market pricing to rely more on emotions and on-the-spot comments. The market will enter a stage of "disordered expectations": expectations themselves become a source of risk, pricing cycles shorten, and asset volatility intensifies.

2.2 Inflation Expectations and Retail Data

The New York Fed's inflation expectations survey shows that the 5-year inflation expectations have hit a recent low, while the 1-year inflation expectations have risen sharply. Consumers have increased their pricing for the threat of an economic slowdown and a full-blown recession, with expectations for unemployment and income growth deteriorating.

Despite soft data from consumer surveys indicating an increased risk of recession, hard data such as retail consumption performed well. In March, U.S. retail and food service sales rose by 1.4% month-on-month and 4.6% year-on-year. Sales of motor vehicles and daily necessities saw a significant month-on-month increase, possibly influenced by the rush to beat tariff effects.

The structural divergence between soft and hard economic data typically occurs during periods of intense policy competition and rising market sensitivity cycles. The retail data in March appears impressive on the surface, but the underlying factors of short-term overdraw, the rush to benefit from tariff effects, and deteriorating consumer confidence create a stark contrast. This "hard strong, soft weak" economic facade is likely a transitional phase before stagflation/recession.

3. Liquidity and Interest Rates

The yield curve of U.S. Treasury bonds reflects the bond market's view of the current market:

1. Expectations for interest rate cuts are strengthening, indicating that the market is more cautious about the economic outlook;
2. The repricing of inflation risks is related to the recent rebound in commodity prices, tariff threats, and debt ceiling negotiations; The market has shifted from "full-year interest rate cuts + soft landing" to a new pricing path of "slowing interest rate cuts + rising long-term inflation risks."

The central bank may face the real pressure of "unable to continuously cut interest rates," while fiscal factors and global supply shocks are pushing up long-term funding costs. The market is heating up to the scenario where "the central bank is forced to cut interest rates while inflation has not yet been suppressed."

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5. Macroeconomic Outlook for Next Week

1. Tariff policies may frequently showcase a cycle of "high-profile toughness --- brief easing," continuously disrupting market expectations.

2. Federal Reserve officials are likely to maintain a "neutral to hawkish" tone to anchor inflation expectations and prevent financial conditions from loosening too quickly.

3. The gap between the deterioration of soft data and the lagging of hard data is widening, and the policy outlook is constrained by the political cycle and fiscal limitations. Volatility may become the asset price variable that reacts first.

Suggestion:

1. Maintain defensive structure: avoid chasing highs, maintain a neutral and defensive position.

2. Key monitoring of "expected disorder" signals: Pay attention to the situation where short-term interest rates weaken while long-term yields remain high.

3. Bottom Line Thinking vs. Trend Betting: Emphasize position control and capital diversification, avoid making directional heavy bets easily, and maintain a moderate contrarian position.

The current market is dominated by policy noise, lagging economic signals, and declining stability of expectations. In this phase dominated by structural uncertainty, controlling risk and delaying bets may be more important than aggressive strategies.