JL-3 SLBM Test — Jul 6

Jul 6, 04:01 UTC: China test-launched a JL-3 submarine-launched ballistic missile from the South China Sea into the open Pacific. Flight path ~7,300 km; simulated training warhead; overflew parts of the Philippines and impacted in the South Pacific Nuclear-Free Zone. First Chinese SLBM test into international open waters — first public demonstration of a sea-based nuclear strike capability in the Indo-Pacific. Missile type (JL-2 vs. JL-3) not officially confirmed; Chinese military commentators and outside analysts assessed JL-3. US, Japan, Australia, and New Zealand condemned the test.

The test coincided with the opening day of the Joint Sea-2026 naval exercise and preceded the Jul 8 combat readiness patrol by 36 hours. USNI News confirmed the sequence Jul 6.

PLA Air Activity — Jul 7–8

Jul 8 — "Joint Combat Readiness Patrol" (PLA designation): 22 sorties of PLA combat aircraft, auxiliary aircraft, and UAVs (J-16, JH-7, KJ-500) detected beginning 1153h local (UTC+8). 14 of 22 sorties penetrated the median line of the Taiwan Strait (including the extension line) and entered Taiwan's northern, central, and southwestern ADIZ sectors simultaneously. Aircraft coordinated with PLAN vessels.

Jul 7: 4 sorties; 9 PLAN vessels + 3 official ships. 3 of 4 sorties crossed median line, entered SW ADIZ.
Jul 8: 22 sorties (J-16, JH-7, KJ-500); 14 of 22 penetrated median line (N, central, SW ADIZ); coordinated PLAN surface forces.

ROC Armed Forces deployed CAP aircraft, Navy ships, and coastal missile systems in response to both events. Week-to-date activity elevated relative to Jun 30 baseline (2 sorties, no crossings).

Joint Sea-2026 — China-Russia Naval Exercise, Jul 6–13

China and Russia conducted "Joint Sea-2026" in the Yellow Sea off Qingdao, July 6–13. Russian participants: cruiser Varyag, corvette Rezkiy, diesel-electric submarine Ufa, rescue vessel Igor Belousov. Chinese participants: destroyers Kaifeng and Anshan, frigate Wuhu, supply ship Kekexilihu, submarine rescue ship Yangchenghu, one unnamed submarine. Post-exercise joint maritime patrol in "relevant Pacific areas" announced.

The exercise is annual. Its coincidence with the SLBM test and the Jul 8 patrol constitutes the densest single-week PLA signaling package since the Jul 4 peak reported Jul 6.

CCG East-of-Taiwan Patrol — Ongoing

CCG Xiushan continues standing patrol ~54 nm east of Hualien (ongoing from Jul 4 rotation, replacing CCGS Daishan). No additional vessels or incidents reported this cycle. Taiwan CGA shadowing operation unchanged. International concern (US/France/Germany/UK) on record; no formal joint response announced.

Arms Sale / Diplomatic Status

$14B arms package (PAC-3, NASAMS, HIMARS, M109A7): US State Dept's top East Asia diplomat clarified Jun 26 that the pending Congressional notification "does not hinge on discussions with China" and that the Six Assurances — including no date for ending arms sales — remain policy. Trump had characterized the package as a "bargaining chip" at the May Xi–Trump Beijing summit, which the State Dept statement partially walked back. No approval, rejection, or new Congressional notification issued Jul 6–13.

PORCUPINE Act (H.R.7146): No House floor vote scheduled. House Foreign Affairs Committee advanced the bill May 13 (45-0 vote). Senate companion S.1744 passed Dec 2025 (unchanged).

LY drone budget: Four competing bills (NT$210–240B) in joint committee; no floor vote. Hai Kun 2nd-boat freeze (NT$11.9B): still pending floor vote.

Xi–Trump White House (Sep 24): Confirmed, unchanged.

Taiwan allies: 12. No diplomatic switch Jul 6–13.

Polymarket Odds

Invasion before Jan 1, 2027: ~4–5% (↓ from ~6%, $38M+ volume)  |  Military clash before 2027: ~12.5% (unchanged)  |  By Jun 30, 2027: ~9–12% (↓ from ~12.5%)  |  By Dec 31, 2027: ~12–14.5% (↓ from ~14.5%)

Markets moved modestly lower despite elevated PLAN signaling this week. ODNI March 2026: PRC leaders "lack plans for an invasion"; no observable amphibious mobilization.

Assessed Invasion Probability

1 month: 1–2% — JL-3 test and Joint Sea-2026 are signaling instruments; no mobilization indicators.
6 months: 5–7% — Sep 24 Xi–Trump meeting; political window without PLAN readiness indicators.
1 year: 10–13% — 2027 Party Congress political incentive; no operational trigger.
5 years: 18–24% — JL-3 operational capability, CCG east-Taiwan standing presence, and gray-zone normalization elevate structural risk.

Next Structural Inflections

Thai/Brunei/Philippines visa-free expiry — Jul 31 (T-18 days; no renewal announced)  ·  PORCUPINE Act House floor vote — no date set  ·  LY drone budget vote — pending joint committee  ·  Hai Kun 2nd-boat freeze vote — pending  ·  Xi–Trump White House — Sep 24  ·  2027 Party Congress