With the weekend passing peacefully and Iran making a new deal proposal, optimism over a negotiated end to the war is rising and sending US equity indices higher.
- Optimism is increasing regarding a negotiated end to the USA / Iran war for the following reasons:
- The weekend, President Trump's favourite time for a military strike, has passed without incident.
- Prediction markets do not forecast a resumption of the war. Polymarket implies combat will be fully over by the end of June, with a negotiated settlement being reached shortly afterwards.
- Iran has proposed a new deal to the USA which would open the Strait of Hormuz while postponing talks over Iran's nuclear program.
- Major US equity indices the NASDAQ 100 and the S&P 500 traded at new all-time highs in off-hours trading this morning, following Friday's record high close. If we see a close at a new high today, that would be an excellent signal to enter a new long trade in either of these indices. Trend traders will already be long of these two indices.
- Crude oil is rising slightly again, but the bid is quite weak. Gasoline prices in the USA remain high, with the Gasoline ETF UGA last week making its highest closing price in a long time. Trend traders will also likely want to be long of this as it still looks bullish. There is good reason to see there are going to be crude oil supply issues persisting.
- Bitcoin has just started making a sharply bearish move after testing and rejecting the long-term high price earlier today, just below $80,000.
- The Forex market was relatively quiet during the Asian session. The USD/JPY currency pair is trading sideways above ¥159. Many trend traders will still be long of USD/JPY.
- There are no high-impact data releases scheduled for today. As it is also a Monday, it may be a relatively quiet day in the market.