For all the breathless excitement unleashed by the Trump administration, what happened on Friday as part of "Phase 1" of the US-China trade deal, was rather underwhelming: the tariff increase scheduled to take effect on October 15 (from 25% to 30% on $250 billion of imports) has been suspended, in return for greater Chinese purchases of US agricultural products (mostly soybeans and pork, which China desperately needs anyway), as well as some vague currency transparency provisions, and greater Chinese market access for financial services firms. Specifically, as laid out earlier, in return for suspension of the October 15 US tariff increase, China appears to have agreed to:

1. $40-$50 billion of purchases of US agriculture and agricultural policy changes,
2. currency transparency, and
3. opening market access for US financial services firms.

Additionally, while President Trump indicated that some progress was made on technology transfer, deal enforcement and intellectual property hinting that some aspects might be addressed in Phase 1, it appears that these key issue will be dealt with primarily in subsequent negotiations.

Yet even with this minimal list of actual accomplishments, Goldman notes that there is "still slight uncertainty regarding the details of the agreement" and adds that "the White House has indicated that the details of the deal will be written up over the next four weeks, with an expectation that the agreement would be signed by Presidents Trump and Xi at the APEC Summit in Santiago, Chile in mid-November." That said, given that the core aspects of "Phase 1" look fairly straightforward, there appears to be a fairly low risk that the deal - as it currently stands - falls through at this point.

To be sure, much of this was anticipated with most analysts expecting an extension of the October 15 tariffs, with the December tariff round the wildcard. It is here that things get more complicated.

Indeed, as Goldman's Alec Phillips writes, while the October 15 tariff increase may have been called off, "the White House has not committed to suspending the planned December 15 tariff round."

As a result, the outlook for that next tariff round depends on progress made in “Phase 2” talks, which will likely to take place in November. And since "Phase 2" , which Lighthizer described as as "down to final details", is expected to focus on far more problematic issues such as intellectual property and technology transfer issues, particularly with regard to enforcement of those reforms, Goldman cautions that "these negotiations nevertheless look like a much more difficult undertaking than the issues addressed in Phase 1." As such, while Trump - and the market - may have taken a victory lap, the real test will take place in about two months.

Putting all this together in practical terms, this is what Goldman believes will happen next:

At this point, we see a 60% chance that the announced 15% tariffs on List 4B will take effect, though a delay until early 2020 is likely in our view given the proximity of the December 15 deadline to the Christmas holiday. In light of the complexity of the issues in Phase 2, we would not expect a decision on the December 15 tariff round until shortly before the deadline. We also note that the December FOMC meeting will be held on December 10-11, and it looks more likely that if a tariff delay were agreed to, it would be more likely to be announced after the FOMC decision than before.

Finally, it's worth recalling that both previous ceasefire "deals" fall apart in a shorter time than the two months we have to wait until Phase 2, so for all those wondering why the market bought the rumor and sold the news...

It likely has to do with the assumption that Friday's trade "deal" was as good as it will get.