Smoke and mirrors
The Iranian conflict is rattling financial markets right now, but even if it ends tomorrow (or next year), traders might not get the relief they’re banking on.
The US has floated a 15-point peace plan to Iran. Turkey, Egypt, and Pakistan are scrambling to set up a summit between the warring parties in the coming hours. Markets want to believe this gets wrapped up quickly.
Unfortunately, there’s zero indication Iran will bite on American demands: dismantling major nuclear sites, stopping uranium enrichment, scrapping their long-range ballistic program, fully reopening the Strait of Hormuz…
Worse, even if they hammer out a deal by Friday, energy markets would need weeks — maybe months — to settle back to normal.
When the dust clears, investors will likely realize this conflict was just a smokescreen hiding a deeper threat to the US economy: stagflation.
The retrospective
Buyers started the day optimistic, pushing toward the symbolic 46,750-point threshold but couldn’t break through[1]. Short sellers countered hard, driving prices back to the daily pivot point[2].
Second half, same story: buyers took another swing at 46,750[3], sellers smacked them down again toward the daily pivot[4].
Today's trading plan
Short sellers still run the show. They’ve taken some profits at the monthly S4 middle band, letting the market bounce a bit.
Despite the strong downward momentum, sellers remain cautious while buyers stay oddly optimistic — suggesting this drop has more room to run.
Given the setup, I’m sticking with short trades but taking profits quickly at key intraday levels until buyers really get trapped in this bounce (which could happen above 47,205 resistance).
Happy trading!
Maxime holds two master’s degrees from the SKEMA Business School and FFBC. As founder and editor-in-chief of NewTrading.fr, he writes daily about financial trading.
Good signs
Strike zone
One Track Hides Another