Unusual Trading Volumes and Possible Insider Trading Activity Before the Tariff Suspension Announcement

On April 9, 2025, President Donald Trump announced a 90-day suspension of most “reciprocal” tariffs, maintaining a base tariff of 10% during this period while simultaneously raising tariffs on Chinese imports to 145%. This unexpected policy shift triggered a significant market rally, with the S&P 500 rising 9.5% by the end of the day.Prior to the official announcement, President Trump posted on his social network, Truth Social: “IT’S A GREAT TIME TO BUY!!! DJT.” This message, published less than four hours before the tariff freeze was made public, has raised concerns about possible insider trading and market manipulation.

Detection of Unusual Trading Volumes

In the hours leading up to the suspension announcement, financial analysts observed unusual trading volumes in certain stocks and sectors likely to benefit from the policy shift. Volume indicators such as On-Balance Volume (OBV) and Chaikin Money Flow (CMF) showed significant spikes, suggesting a sudden accumulation of shares. These anomalies have sparked speculation about whether some investors had advance knowledge of the announcement.

Calls for Investigation

Senator Adam Schiff has called for a congressional investigation to determine whether individuals within the administration profited financially from prior knowledge of the policy change. Schiff expressed concern about the timing of the announcement and pre-market activity, emphasizing the need to ensure that no undue gains were made at the public’s expense.

Implications

The convergence of unusual volumes, the president’s social media activity before the announcement, and the market’s subsequent rally highlights the importance of transparency and ethical conduct in government communications. These events underscore the need to carefully monitor market activity and investigate any irregularities to maintain public trust and market integrity.

Investor Tips: How to Use Volume Indicators to Detect Potential Insider Activity

For investors seeking to protect their portfolios and capitalize on market moves, understanding and monitoring volume indicators can be highly valuable. Unusual volumes often precede significant price shifts and may signal insider activity. Below are some key indicators and recommended strategies:

• On-Balance Volume (OBV): OBV measures buying and selling pressure by adding volume on up days and subtracting it on down days. A rising OBV suggests accumulation, while a falling OBV indicates distribution. Monitoring OBV can help confirm trends or warn of potential reversals.

• Chaikin Money Flow (CMF): CMF assesses accumulation and distribution over a period by combining price and volume. A positive CMF indicates buying pressure, while a negative one signals selling pressure. Unusual CMF spikes may point to atypical activity.

• Volume Moving Average (VMA): Calculating the average volume over a specific period helps identify deviations from the norm. A sudden volume increase compared to the average may indicate out-of-the-ordinary activity.

Strategies for Traders:

• Monitor Volume Patterns: Regularly analyze volume indicators to detect anomalies that may precede major moves.

• Correlate Volume with News Events: Watch for coincidences between volume spikes and upcoming news to assess the legitimacy of activity.

• Use Real-Time Data Tools: Utilize platforms that offer real-time volume data and alerts for unusual activity.

• Proceed with Caution Around Unexplained Volume: Approach stocks with unexplained volume surges carefully, conducting due diligence before trading.

By integrating volume analysis into their strategies, investors can better anticipate market moves and shield themselves from potential manipulation.