Rare Earths & Market Impact
Geopolitical tensions are directly impacting markets. The latest flashpoint? Rare Earth Minerals. Reports indicate China, controlling ~92% of global processing, is restricting exports to the US. This isn't just news; it's a major variable for investors. 🧵👇
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Why does this matter? Rare earths are CRITICAL for modern tech: iPhones, EVs, wind turbines, advanced weaponry (F-35s, subs), MRI machines & more. China's dominance gives it significant leverage, turning these minerals into strategic assets
The reported export controls on 7 types of rare earths (+ related products like magnets) directly target key US industries. Unlike tariffs, this is leverage where the US has limited immediate retaliation options due to dependency (70% of US imports 2020-23 came from China).
Portfolio Impact
his highlights how geopolitical events create REAL market turmoil & supply chain risk. Potential impacts:
➡️ Increased costs for tech/EV/defense sectors
➡️ Inflationary pressures
➡️ Heightened volatility in specific stocks/ETFs
TA Strategy: How to navigate?
➡️ Monitor ETFs like $VanEck Rare Earth/Strategic Metals ETF(REMX)$ (Rare Earth/Strategic Metals) & $Global X Lithium & Battery Tech ETF(LIT)$ (Lithium/Battery Tech) for technical signals (breaks, volume).
➡️ Watch key sectors (Semis $VanEck Semiconductor ETF(SMH)$ , Defense $iShares U.S. Aerospace & Defense ETF(ITA)$ , EVs) for relative strength/weakness.
➡️ Keep stops tight & manage position size. Uncertainty demands discipline.
The US is trying to build domestic supply chains ($439M+ DoD funding), but experts agree this takes YEARS. Companies like USA Rare Earth & Phoenix Tailings are scaling, but can't fill the gap immediately. This vulnerability = ongoing market risk factor.
Key Takeaway for Investors
Geopolitical factors are not abstract – they directly influence market dynamics & your portfolio. Stay informed, use technical analysis to gauge market reactions & manage risk proactively. Analysis > Headlines.
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Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
