Watched this whole thing unfold Friday into Saturday and honestly can't tell if anyone's repriced yet. Friday afternoon Iran said Hormuz was fully open. WTI cratered 10+ percent in a session. Gold held around 4878. SPX sat at record highs. Markets priced peace.
Saturday Iran walked it back. IRGC fired on an Indian VLCC carrying 2 million barrels of Iraqi crude. India summoned Iran's ambassador. 20-plus ships u-turned. Trump said the US blockade stays in full force. So the "completely open" window lasted less than a day.
So what does Monday open at? Honestly not sure anyone's confident. Friday's close doesn't reflect what happened Saturday. If your shop didn't get weekend-updates into Monday's risk book, you're starting the week marked to a ceasefire that doesn't exist anymore.
The piece I think most people are underweighting: Wednesday. That's when the whole thing expires. AP says there's an in-principle deal. A senior US official says there's no formal agreement. Both on the record, same weekend. Shuttle diplomacy running through Pakistan right now. Any Monday or Tuesday headline out of Islamabad will probably move oil 3-5 percent on interpretation alone. That's a lot of gamma for three trading days.
Secondary thing I'm watching: WSJ reported over the weekend that the US military is staging up to board and seize Iran-linked tankers in international waters. That's a real escalation from the current turn-back posture. If that happens mid-week and the ship is Chinese-owned (Rich Starry was sanctioned by the US and is owned by a Shanghai company, so it's the obvious first target), you're looking at a different class of tail risk than a pure Middle East oil premium. USDCNY, tech, defense all react to a direct US-China maritime incident.
One more thing. Energy majors lagged Friday's oil drop. XLE barely moved relative to the front-month futures. That usually means operators are pricing longer-term Iran risk, not weekly spot. If you think Wednesday goes well, XLE is a short. If you think it goes badly, XLE is already in the trade and the catch-up happens elsewhere (gold, defense, Brent calls).
Not gonna pretend I know how this resolves. Both scenarios are in the price somewhere. But the weight shifts with every headline and we get a lot of them this week.
Friday priced a ceasefire that didn't hold. What that weekend toggle means for Monday's open.
byu/Mother-Grapefruit-45 inStockMarket
Posted by Mother-Grapefruit-45
9 Comments
Itll prob gap down and then keep going up, I’ll be shocked if we see a reversal
BRO, the deal is going to be made by morning
“It *could be the same* or maybe a little bit *higher*, but it *should* be around the *same*” -*Trump*
If it’s like anything we’ve seen the past month regardless of a ceasefire, market will react with hopes and prayers, welcome to the casino.
The other thing that is happening on Tuesday is WTI settlements for May contracts. Which, unless the US Treasury has been engaging in futures manipulation, would be a ticking time bomb for oil prices. Iran also, at this moment, aren’t sending a delegation to Pakistan until the naval blockade is lifted. So there’s no real confirmation whether these talks are happening now or before the end of the ceasefire.
Everything could turn around in the next three days, or it could all completely go to hell and we’re on track for a global recession by Friday. Too much shit is up in the air. I’d personally just stay out of the market until there’s at least a couple key events resolved and we have better clarity on what’s happening.
the market is basically a mood ring for geopolitical headlines right now. Friday’s rally was massive because everyone was banking on that 10-day ceasefire holding, but if the news over the weekend shows it’s already shaky, Monday is probably going to be a bloodbath for anyone who didn’t hedge. I’ve been trying to stay objective by keeping a “war room” dashboard in Notion with live feeds from Reuters and Bloomberg to track the updates in real-time. It feels like the big money is just using these “peace” pops as exit liquidity anyway, so I’m staying heavy in cash until we see if the Strait actually stays open.
If you don’t know what to do, do nothing. No one knows what will happen- the uncertainty will eventually become its own problem.
This was part of the plan
Media cycle changed – Iran is old news now
Trying to rationalize any of this is a fool’s errand