Beijing maintains pressure on Taiwan through sustained gray-zone activities, including frequent coast guard patrols east of the island and normalized PLA exercises around the strait, rather than preparations for full-scale invasion. Ongoing US-China diplomatic channels, including potential leader summits, and Beijing’s emphasis on long-term unification strategies without a fixed military timeline support the market’s high probability for no invasion by late 2027. Taiwan has responded with supplementary defense budgets targeting drones, missiles, and ammunition stocks, alongside combat readiness drills, which analysts link to improved deterrence. These patterns reflect traders’ assessment that coercion and capability-building remain the dominant approach over direct conflict.