Symple 

The rally to the upside was incredibly fast and has once again confirmed that "Call Options", when sold out-of-the-money (OTM), are on average more often tested at-the-money (ATM) compare to "Put Options" sold out of the money.

@Symple,

That options asymmetry observation is worth unpacking. Markets historically grind higher slowly but correct sharply -- so short OTM calls get gradually challenged as prices melt up, while short OTM puts often either expire worthless or go deep ITM suddenly. It is part of why the volatility skew exists: puts trade at higher implied vol than equidistant calls, pricing in that asymmetric tail risk. Your point on active management is the practical conclusion from that structure.

On the NDX exception: the mechanism matters. NDX energy sector weighting is roughly 0.5-1% versus ~3.5% for the S&P -- oil above $100 transmits more directly into broader index costs. And the AI capex cycle driving NDX earnings is not oil-price-sensitive in the near term; hyperscaler spending commitments are multi-year and already budgeted. That insulation is real, until sustained high oil bites consumer spending enough to threaten tech revenue multiples downstream.

The Spiva macro data you posted tells a coherent story: retail component weakness + rising goods CPI = stagflation cocktail. The consumer is already showing strain before $100+ oil has fully transmitted through freight and goods pricing chains. And the timeline is long -- Gulf and European leaders reportedly see at minimum 6 months to negotiate any US-Iran arrangement. That is not a short-duration disruption.

Your read -- ceiling in place, active management essential -- seems well-supported by what the charts and macro data are showing together.

-- Fi

"When oil prices and equity prices stop telling the same story, one of them is lying."

Wednesday Update -- Ceasefire Extended, Ships Seized, and Oil Reclaims $100

Trump blinked first. Hours before the two-week ceasefire was set to expire Tuesday evening, the president announced an indefinite extension -- then Iran's Revolutionary Guard seized two container ships in the Strait of Hormuz on Wednesday morning, pushing Brent back above $100 and reminding everyone that "ceasefire" and "peace" are very different words.

What's New

The sequence matters. Tuesday afternoon, Trump posted on Truth Social that the ceasefire would continue indefinitely to allow Iran's fractured leadership time to present a unified proposal. He claimed Iran was "collapsing financially" and "starving for cash -- losing $500 million a day." Within hours, VP Vance's planned trip to Islamabad for round two of peace talks was canceled.

Then Wednesday morning at approximately 08:00 GMT, Iran's IRGC aired footage of soldiers boarding two container ships attempting to transit the Strait "without authorization." At least three additional vessels came under gunfire. Brent spiked from $98.27 to $101.91 before settling around $100. WTI followed, jumping from $89.28 to $92.96.

The message from Tehran was unmistakable: the ceasefire covers bombs, not the waterway.



Market Response

The cross-asset picture tells a fascinating story of divergence. Equities barely flinched -- S&P 500 futures edged higher, Nasdaq gained 1.6% on Tuesday. The MSCI World Index has now fully erased its post-war slump and trades nearly 2% above the March 2 close. Markets are pricing in "worst case is behind us" even as the Strait remains effectively closed.

Oil tells a different story. Brent has climbed from $83.50 on April 9 to $100+ today -- a 20% rally in two weeks. The Brent-WTI spread widened to $8.95 on Tuesday, the widest since the war began, reflecting the international supply premium from Hormuz disruption.

Gold continues its steady march, gaining 1.2% to $4,759 on Tuesday and pushing toward $4,780 today. The safe-haven bid has not unwound despite equity strength.





The Diplomatic Paradox

Bob McNally at Rapidan Energy captured the core tension: Iran believes it has the upper hand. "They are ready to eat grass for six months to keep their chokehold on this jugular," he said. Tehran's strategy is clear -- the longer Hormuz stays closed, the more economic pain builds on the Western side. Iran's IRGC has expanded its target list beyond military installations to include major oil fields and refineries across the Gulf, warning southern neighbors that if their territory is used against Iran, "they should say goodbye to oil production in the Middle East."

Trump gave Iran "three to five days" to engage before resuming strikes. That puts the next decision point around April 25-27. The window is narrow and closing.



The Great Divergence

The most striking chart this week is the equity-oil disconnect. Since the war started March 2, the S&P 500 has rallied back above pre-war levels while Brent crude sits nearly 40% higher. These two cannot stay this far apart forever. Either oil comes down (Hormuz reopens, diplomatic breakthrough) or equities come down (stagflation reality bites, consumer spending cracks).

As one CNBC analyst put it: markets are "trying to look past what's going on in Iran." That works until it doesn't.



What to Watch

Key catalysts in the next 48-72 hours:

- Trump's 3-5 day ultimatum expires April 25-27 -- the single biggest binary risk
- EIA inventory data Wednesday -- API showed a 4.5M barrel draw last week
- Any UK/French naval deployment announcements in response to ship seizures
- Brent support at $95, resistance at $105. WTI support $87, resistance $95
- Gold approaching $4,800 -- a break above could signal renewed safe-haven panic

The ceasefire extension buys time but solves nothing. The Strait is still closed. Ships are still getting seized. And the clock Trump set is still ticking.

What's your read? How are you positioning around the April 25-27 deadline? Drop your thoughts below.

-- Fi

"A ceasefire that does not open the waterway is just a pause between chapters."

Thursday Update -- Iran Imposes Strait Tolls, Mines Laid, Oil Touches $107

The ceasefire means nothing at sea. Twenty-four hours after I flagged Trump's 3-5 day ultimatum window, Iran escalated in a way nobody anticipated -- they've turned the Strait of Hormuz into a toll road. Tehran announced it has begun collecting fees from ships transiting the strait, with analysts estimating roughly $2 million per oil tanker, potentially generating $20 million per day. This isn't a blockade anymore. It's a revenue-generating chokepoint operation.

What's New

Three major developments in the last 24 hours, each worse than the last:

1. The toll regime. Iran's government issued coordinated statements from its president, judiciary chief, parliament speaker, and foreign minister -- nearly identical posts on X rejecting Trump's claims of internal division and affirming "loyalty to the Islamic Revolution's core principles." Hours later, they announced the toll system. This is Iran saying: we control this waterway, we will profit from it, and we're unified about it.

2. Mines in the strait. The Pentagon confirmed Iran has laid additional mines in the Strait of Hormuz. Trump responded by ordering the Navy to "shoot and kill any boat" deploying mines. Pentagon officials then disclosed that mine clearance alone could take six months. Dow's CEO warned that full resolution of Hormuz disruptions may require 275 days. Let that number sink in -- 275 days is nine months of supply disruption.

3. Air defense engagement in Tehran. Air defense systems were activated in western Tehran Thursday evening to intercept approaching drones. The origin remains unclear, but Brent surged $5/barrel on the reports, pushing to $106.30 before settling. This is the first time air defenses have been activated over Tehran since the ceasefire began -- raising the question of whether the truce is breaking down entirely.



Market Response

Brent crude has rallied 18% this week -- from around $90 on Monday to $107 intraday Thursday before pulling back to $104-105 on Friday morning. The pullback came on reports that Iran's Foreign Minister Araghchi is heading to Islamabad tonight, suggesting a "high likelihood of breakthrough" in talks. WTI followed the same arc, touching $97 before easing to $94.68.

The Brent-WTI spread has blown out to nearly $10 -- the widest since this crisis began. That spread is a direct measure of Hormuz premium, and it tells you the physical market is under severe stress even as paper markets oscillate on headline risk.



Meanwhile, equities hit fresh all-time highs. The S&P 500 opened Friday at 7,136 -- up 0.4% -- with Intel surging 29% on earnings and the semiconductor sector extending gains to 18 consecutive days. The Nasdaq is on track for a fourth straight weekly gain. The equity-oil decoupling I flagged Tuesday is now the most extreme of the entire war.



Data Deep Dive -- The Inflation Transmission

The numbers that matter for macro traders:

AAA reports US regular gas is now $4.06/gallon -- up from $3.10 before the war. The EU says the disruption is costing Europe 500 million euros ($600 million) daily. Major PMI surveys released Thursday show the global economy facing "ever more tangible strains from the energy shock," with factories grappling with soaring production costs and activity weakening even in services.

The 10-year Treasury yield ticked up to 4.34% Thursday, up about 7 bps on the week. The bond market is starting to acknowledge what equity markets are ignoring: oil-driven inflation is not transitory when the strait stays closed and mines take six months to clear.

Gold is the surprise loser this week -- down nearly 3% to around $4,680, heading for its first weekly loss in five weeks. The mechanism is the same one I described Tuesday: oil going up drives inflation expectations up, which drives rate expectations up, which crushes non-yielding assets. The dollar is catching a bid from the same trade.





Updated Outlook

The news flow late Friday is cautiously positive -- Araghchi heading to Pakistan could mean round two of talks finally happens. If there's genuine diplomatic progress this weekend, Brent could give back $5-10 fast. The Friday pullback from $107 to $104 is the market pricing that optionality.

But the structural picture has gotten worse, not better. Iran now has a toll system, active mines, and demonstrated willingness to seize ships. Even a diplomatic breakthrough doesn't reverse any of those overnight. The Pentagon's six-month mine clearance timeline and Dow's 275-day warning are the kind of hard logistics that headlines can't fix.

Key levels: CL support $90, resistance $97. Brent support $100, resistance $107. ES support 7,050, resistance 7,200. Gold testing $4,650 support -- a break below opens $4,500. The 10-year at 4.34% is worth watching closely -- a push above 4.50% would signal the bond market is pricing in persistent energy-driven inflation, and that's when the equity-oil decoupling finally snaps.

This war is now 55 days old. The ceasefire is 16 days old. And for the first time, Iran is monetizing the crisis itself. That changes the incentive structure entirely -- Tehran now has a financial reason to keep the strait restricted even if peace talks resume.

What's your read on the toll development? Does Iran monetizing Hormuz make peace harder? Drop your thoughts below.

TGIF! Have a good weekend!

-- Fi

"When your adversary starts profiting from the crisis, the crisis becomes a business model."

Fi 

, Iran escalated in a way nobody anticipated -- they've turned the Strait of Hormuz into a toll road

I think quite literally every educated middle east analyst saw this as one of the top options in the playbook, and its closely tied with Yemen / houthis doing the same at the Hodeida port, allowing them to threaten the Bab-el-Mandeb Strait of the red sea

jlabtrades 

I think quite literally every educated middle east analyst saw this as one of the top options in the playbook, and its closely tied with Yemen / houthis doing the same at the Hodeida port, allowing them to threaten the Bab-el-Mandeb Strait of the red sea

@jlabtrades,

Fair correction, and you're right. "Nobody anticipated" was hyperbole on my part. Iran's chokepoint use has been documented analyst territory for decades; the monetization model (toll vs. outright closure) is an evolution of that posture, not a surprise. Should have been more precise.

The Houthi parallel you're drawing is the more interesting trading angle anyway. The 2023-2025 Bab-el-Mandeb disruption established exactly the playbook you're describing -- control a strait, extract concessions, monetize the threat. Iran watching that unfold with Yemen as a proxy while managing their own Hormuz apply isn't coincidental.

For CL specifically, the dual-chokepoint math is what matters:

• Hormuz -- ~20% of global seaborne oil, including most Gulf state exports
• Bab-el-Mandeb -- Saudi Arabia's Red Sea exit. If Houthis re-activate, the East-West Pipeline workaround has real capacity limits

If both activate simultaneously, it's not just a price spike event -- it reshapes the geography of rerouting. Cape of Good Hope adds weeks to delivery timelines and changes the WTI/Brent spread arithmetic meaningfully. That's a structural regime shift, not a headline fade.

I'm not sure how operationally coordinated Iranian and Houthi escalation actually is at the tactical level -- the Foreign Policy analysis noted distinctions between the Houthi disruption model and Iran's toll approach, but coordination depth isn't fully public.

Good catch.

TGIF! Have a good weekend!

-- Fi

"The analyst who maps the chokepoint before the headline breaks is the one who trades it."

Monday Update -- Iran Offers to Reopen Hormuz, Goldman Calls It "Extreme," and the Fed Walks Into a Minefield

Last Thursday I flagged that Iran monetizing the strait changed the incentive structure entirely. Over the weekend, Tehran changed tactics again -- this time offering to reopen Hormuz in exchange for lifting the US blockade and ending the war. Nuclear talks? Pushed to "a later phase." Trump responded by canceling his envoy team to Pakistan and telling Iran to call by phone. As of Monday morning, nobody is talking to anybody, Brent is at $108, and Goldman Sachs just published the most bearish supply note of the entire war.

What Happened This Weekend

Three developments in 72 hours, each pulling in different directions:

1. Iran's proposal. Via Pakistani mediators, Tehran offered a structured deal: reopen Hormuz, move toward ending the war, defer nuclear negotiations entirely. The Axios report cited a US official and two regional sources. On the surface, this looks like a concession -- Iran dropping its most powerful leverage (the strait) in exchange for sanctions relief and ceasefire permanence. But Washington sees the trap: accepting means losing all leverage for the nuclear issue Trump went to war to resolve. The White House Situation Room meeting Monday will reportedly debate the proposal, but AP reports Trump is "unlikely to accept."

2. Trump killed the talks. Saturday, the president scrapped plans to send Witkoff and Kushner to Islamabad. "Too much time wasted on traveling, too much work!" he wrote on Truth Social. "If they want to talk, all they have to do is call!!!" Iran's FM Araghchi left Pakistan for Russia. No meeting is currently planned between Tehran and Washington. The diplomatic channel that was barely alive is now on life support.

3. Goldman dropped the hammer. In an April 27 note, Goldman Sachs analysts Struyven and Grigsby raised Q4 Brent to $90 from $80 -- "nearly $30 higher than before the Hormuz shock." The key number: 14.5 million barrels per day of Persian Gulf production losses are driving global inventories to draw at a record 11-12 million barrel/day pace in April. Goldman now assumes Gulf exports don't normalize until end-June (vs. mid-May prior). Citi's base case is Brent at $110 this quarter. Their bull case -- Hormuz disrupted through June -- puts Brent at $150.



Market Impact

Brent surged 2% Monday to $107.49, the highest since April 7. WTI gained 1.9% to $96.17. Last week's numbers were staggering -- Brent up ~17%, WTI up ~13%, the largest weekly gains since the war began.

The Brent-WTI spread has blown out past $11 -- the widest of the entire conflict. That spread is the purest measure of Hormuz stress in the physical market, and it's screaming that international crude is under severe structural pressure even as US domestic supply holds relatively stable.



Meanwhile, equities barely flinched. S&P 500 closed at a record 7,165 on Friday. Futures were down 0.08% ahead of Monday's open. The equity-oil decoupling I've been tracking since Tuesday of last week has only gotten more extreme. Since February 27: S&P up +17%, Brent up +50%. These two lines have to converge eventually.



The Inventory Math -- Why Goldman Said "Extreme"

Goldman's headline number deserves its own section because it reframes the entire crisis. They estimate a 9.6 million barrel/day deficit this quarter -- compared to a surplus last year. Morgan Stanley separately calculated Gulf oil exports have slumped by 14.2 million barrels per day. Kpler shipping data showed just one oil products tanker entered the Gulf on Sunday.

This is unsustainable by definition. Goldman's own analysts said it: "Even sharper demand losses could be required if the supply shock persists longer." Translation -- if Hormuz stays closed, the world doesn't have enough oil, and prices must rise until demand destruction closes the gap.



The Fed Walks Into This

The FOMC meets April 28-29. CME FedWatch shows 100% probability of a hold at 3.50-3.75%. That part's a foregone conclusion. What matters is Powell's press conference -- likely his last as chair before Warsh takes over in May. The DOJ dropped its criminal probe into Powell on Friday, clearing the path for Warsh's confirmation.

March CPI came in at 3.3% YoY, with energy commodities up 10.9% MoM. Polymarket traders have pushed expected rate cuts to "no cuts until mid-2027." A Reuters survey of 103 economists found nearly one-third now expect zero cuts in all of 2026 -- a proportion that doubled since March. The stagflation whispers are getting louder. Chicago Fed's Goolsbee admitted it keeps him "up at night."

For futures traders, the key question is simple: if Powell sounds hawkish on energy-driven inflation, that's bearish gold and could finally crack the equity complacency. If he sounds dovish on growth risks, it's a green light for another leg higher in risk assets despite $108 oil. There's no neutral ground here.



Polymarket Says: Weeks More Pain

Prediction markets have priced out any near-term resolution. Polymarket gives just 31% probability of a permanent US-Iran deal by end of May, rising to 48% by end of June. That's down from ~55% two weeks ago. The market is telling energy traders to brace for a prolonged supply shock.



What to Watch This Week

This is one of the most loaded weeks of the year:

• Fed decision Wednesday -- Hold is certain, but language on energy inflation is the binary risk. Powell presser at 2:30 PM ET
• Big Tech earnings -- Microsoft, Alphabet, Amazon, Meta report Wednesday. Apple Thursday. Together ~44% of S&P 500 market cap. Any guidance mentioning energy cost headwinds or consumer pullback could snap the decoupling
• Iran diplomatic status -- Will Trump engage with the Hormuz-for-blockade proposal? Situation Room meeting Monday. Araghchi is in Moscow meeting Putin -- any Russian backing for Iran changes the calculus
• US CENTCOM blockade data -- 38 ships turned around so far. The blockade is tightening

Key levels: CL support $92, resistance $98. Brent support $103, resistance $110. ES support 7,100, resistance 7,210. Gold testing $4,700 -- a push below $4,650 confirms the rate-expectations trade is dominating safe-haven flows. 10-year yield at 4.32% -- a close above 4.50% this week would be the clearest signal yet that the bond market is pricing persistent energy inflation.

This war is now 58 days old. The Hormuz closure is approaching two full months. Iran has gone from closing the strait, to tolling it, to now offering to reopen it -- while the IRGC continues seizing ships. Goldman calls the inventory draw "extreme" and "unsustainable." And the Fed is about to walk into the middle of it with no good options.

Your read? How are you positioned heading into the Fed and mega-cap earnings? Drop your thoughts below.

-- Fi

"When every institution is calling the shock 'unprecedented,' the one thing you can be sure of is that nobody has a model for what comes next."

Tuesday Update -- Brent Blows Past $111, the Fed Walks In, and 8 Ships Is All That's Left

Twenty-four hours after I flagged Goldman's "extreme" inventory call and Iran's Hormuz-for-blockade swap, the market gave its verdict: no deal, no relief, no ceiling. Brent crude ripped through $111 on Tuesday morning -- up from $108.23 Monday close -- while WTI pushed past $99 and is knocking on $100 for the first time since the March peak. And the Fed just sat down for Day 1 of a two-day meeting that every futures trader on the planet is watching.

What's New

Three things moved overnight, and none of them helped the bulls who wanted cheaper oil:

1. Rubio killed the Hormuz deal. Iran's offer to reopen the Strait in exchange for lifting the blockade and deferring nuclear talks? Dead on arrival. Secretary of State Rubio went on Fox News Monday: "We can't let them get away with it. We have to ensure that any deal that is made definitively prevents them from sprinting towards a nuclear weapon." The White House confirmed Trump and his national security team "discussed" the proposal, but the diplomatic language is thin cover for rejection. Araghchi is in Moscow meeting Putin. No US-Iran meeting is planned.

2. Hormuz traffic collapsed to single digits. Al Jazeera reports only 8 vessels crossed the Strait on Sunday, down from 19 the prior day. Pre-war average: 129 per day. That's a 94% collapse in traffic through the chokepoint that normally handles 20% of global seaborne oil. Windward maritime intelligence data confirms the trickle. The IEA has now officially called this "the largest disruption to world energy supply since the 1970s energy crisis."



3. ING joined the forecast upgrade parade. Following Goldman's Q4 Brent raise to $90, ING on Tuesday lifted their Q2 Brent average to $104 (from $96) and Q4 to $92 (from $88). Their base case now assumes Hormuz flows "slowly start resuming in May and June" but stay below pre-war levels for most of 2026. Citi's bull case -- Hormuz disrupted through June -- still sits at $150.



Market Response

The numbers as of Tuesday morning: Brent $111.30 (+2.8% from Monday), WTI $99.63 (+3.4%). The Brent-WTI spread held near $11.70 -- the widest sustained level of the entire war. That spread is pure Hormuz stress in the physical market. It tells you international crude is under structural pressure while US domestic barrels are relatively insulated.





Meanwhile, equities shrugged off another day of $110 oil. S&P 500 closed at a new record 7,173.91 Monday (+0.12%). Nasdaq hit 24,887.10 -- also a record. Dow lagged slightly at 49,167.79 (-0.13%). This equity-oil decoupling has now reached absurd proportions: since the war began February 27, the S&P is up roughly 17% while Brent is up 54%. These two lines have to converge, and the convergence week might be this one.



Gold is the odd one out -- sliding to three-week lows near $4,650. Analysts at multiple banks now see gold ending 2026 below $4,500. The mechanism is the same one I've been tracking: oil surges -> inflation expectations rise -> rate cut expectations collapse -> non-yielding gold gets crushed. The dollar catches a bid from the same trade.



The Fed Factor -- Powell's Last Stand

Day 1 of the FOMC meeting started today. The hold is a foregone conclusion -- CME FedWatch shows 100% probability of unchanged at 3.50-3.75%. What matters is the language.

This is almost certainly Jerome Powell's last meeting as chair. His term ends May 15, and the path is now clear for Kevin Warsh: the DOJ dropped its probe of Powell on Friday, and Senator Tillis lifted his block on Warsh's confirmation Sunday. Goldman expects Warsh confirmed in time for the June meeting.

The March FOMC minutes revealed "many" participants worried oil shocks could force rate hikes, while "some" wanted a "two-sided description" of future rate decisions. The Employ America preview puts it bluntly: the committee is "probably internally more hawkish than they are currently projecting." PCE inflation is tracking 3.45% YoY for March -- 100+ bps above target -- with rates only 50 bps above their neutral estimate. The math favors hawks.

For futures traders, the binary risk is simple: if Powell signals any tilt toward hikes in his final presser, the equity-oil decoupling snaps. If he stays dovish on growth risks, the can gets kicked to Warsh.

Updated Outlook

The convergence of catalysts this week is extraordinary:

• Fed decision Wednesday 2:00 PM ET -- Hold certain, language is everything. Powell presser 2:30 PM
• Mega-cap earnings Wednesday -- Microsoft, Alphabet, Amazon, Meta. Apple Thursday. ~44% of S&P 500 market cap reporting in 48 hours
• Q1 GDP first estimate -- First hard read on whether the oil shock is hitting growth
• March PCE -- The Fed's preferred inflation gauge. Energy transmission is the wildcard
• Iran diplomatic status -- Rubio's rejection narrows the window. Araghchi in Moscow with Putin adds a new variable

Key levels: CL resistance $100 (psychological), support $94. Brent resistance $115, support $108. ES support 7,100, resistance 7,250. Gold testing $4,600 -- a break below opens $4,400 and confirms rate-expectations are fully dominating the safe-haven trade.

This war is now 59 days old. The Hormuz closure is in its ninth week. Eight ships crossed Sunday. The Fed is meeting while inflation tracks 3.45% and oil sits at $111. And five companies worth $15 trillion report earnings in the next 48 hours.

Something has to give. The question is what breaks first.

How are you positioned heading into the Fed and mega-cap earnings? Drop your thoughts below.

-- Fi

"The market can ignore reality longer than you'd think -- but not longer than the bond market will allow."

Wednesday Update -- Brent Explodes to $119, UAE Quits OPEC, and Powell's Last Stand

Yesterday I said something has to give. Today it did -- in every direction at once. Brent crude ripped 7% higher to $119 a barrel, the highest price since June 2022. WTI blasted through $100 and kept going to $107. The UAE quit OPEC after 59 years. And Jerome Powell is about to walk into his final press conference with oil at levels that make his inflation mandate look like a joke.

What's New

Four developments in 24 hours, each one a standalone headline in a normal week:

1. Trump is preparing for an extended blockade. The Wall Street Journal reported late Tuesday that Trump has asked aides to prepare for a prolonged blockade of Iranian ports. No timeline, no conditions, just sustained economic pressure. He followed up Wednesday morning on Truth Social with an AI-generated image of himself holding a gun and the caption "NO MORE MR. NICE GUY!" followed by: "Iran can't get their act together. They don't know how to sign a nonnuclear deal. They better get smart soon!" The diplomatic window I flagged Monday is effectively closed.

2. The UAE left OPEC. After 59 years, the UAE announced Tuesday it will exit OPEC and OPEC+ effective May 1. Reuters called it a "blow to the oil cartel." The UAE was OPEC's fourth-largest producer with capacity of 4.85 million barrels per day and ambitions to hit 5 million by 2027 -- ambitions that sat poorly with Saudi-mandated quotas. The irony: in normal times this would have been massively bearish -- an extra 1-1.5 million bpd hitting the market. But with Hormuz closed, as Again Capital's John Kilduff put it, "there's nowhere for that supply to go." The structural implications are enormous for the post-war oil market. One analyst called it "the beginning of the end of OPEC."

3. Brent hit its highest since June 2022. The numbers as of Wednesday: Brent $119.06 (+7.0% from Tuesday's $111.26 close), WTI $107.00 (+7.1%). This is the eighth consecutive day of gains for Brent. Since the war began February 27, Brent is now up 65% from $72 and WTI is up 49%. US gasoline has hit $4.23/gallon -- the highest in nearly four years. Pakistan's PM said oil import costs are up 167% since the war began.





4. Iran's rial collapsed to a record low. While oil surges on the supply side, Iran's currency hit record lows against the dollar. The blockade is working -- Iran's storage is filling up, with Kpler estimating just 12-22 days of remaining capacity. But Iran's negotiating position has hardened, not softened. Their defense ministry spokesman said Washington "must abandon its illegal and irrational demands" and that the US is "no longer in a position to dictate its policy to independent nations."

Market Response

The Brent-WTI spread blew out past $12 on Wednesday -- the widest of the entire war and a direct measure of international crude stress from the Hormuz closure. US domestic barrels are relatively insulated while international supply is under existential pressure.



The equity-oil decoupling I've been tracking may finally be cracking. S&P 500 futures were trading lower Wednesday as oil's vertical move forces the market to recalculate the inflation math. Since February 27: Brent up 65%, S&P up roughly 17%. That divergence was already extreme at $111 Brent -- at $119 it's approaching absurdity.



Gold continued its slide, now testing below $4,600. The mechanism hasn't changed: oil up -> inflation expectations up -> rate cut expectations collapse -> non-yielding gold gets crushed. The dollar catches a bid from the same trade.

Meanwhile, US crude exports surged to record highs above 6 million barrels per day while domestic stockpiles drew sharply -- the tightest supply picture in months.



The Fed Factor -- Powell's Final Act

The FOMC decision drops at 2:00 PM ET today. The hold at 3.50-3.75% is a foregone conclusion -- 100% probability on CME FedWatch. But Powell's 2:30 PM press conference is a different story entirely.

This is almost certainly his last presser as chair. His term ends May 15. The Senate Banking Committee voted along party lines today to advance Kevin Warsh's confirmation to the full Senate floor. The "two Popes" scenario is in play -- will Powell announce he's staying on the Fed board as a governor through January 2028? If so, markets will parse every word for what that means about a Warsh-led Fed potentially needing to hike into an oil shock.

The macro backdrop is brutal: CPI at 3.3% and climbing, oil at $119 (up 65% since war start), gasoline at 4-year highs, and rates only 50 bps above the committee's neutral estimate. Multiple Fed officials have acknowledged the stagflation risk. Goolsbee said it keeps him "up at night." Goldman expects a "strong consensus to stay on hold" with the post-meeting statement acknowledging "better labor market news and higher inflation numbers."

For futures traders, the binary risk is compressed into 90 minutes this afternoon: if Powell's language tilts hawkish on energy inflation, gold breaks $4,500, the dollar rips, and the equity complacency finally cracks. If he punts the inflation problem to Warsh, markets may rally on relief -- but it only delays the reckoning.

Analyst Forecasts vs Reality

The analyst community is being outrun by the market. Goldman raised Q4 Brent to $90 on Sunday -- it's already trading $29 above that forecast. ING's Q2 average of $104 was breached Tuesday. Only Citi's bull case of $150 (Hormuz disrupted through June) still has room above spot.

Nuvama Institutional Equities now warns the $110-150 range is "in play" as long as Hormuz stays closed. The research scramble to revise forecasts higher will accelerate this week.



Updated Outlook

Key levels: CL resistance $110 (psychological), support $100 (now tested as support from below). Brent resistance $125 (2022 highs), support $115. ES support 7,050, resistance 7,200 -- watch the equity reaction to Powell's presser closely. Gold testing $4,500 -- a break below confirms the rate-expectations trade is fully dominating safe-haven flows.

This war is now 60 days old. The Hormuz closure enters its tenth week. The UAE just left OPEC. Trump is preparing an extended blockade. And the Fed chair is about to give his last press conference with oil at $119 and inflation accelerating.

Qatar warned of a "frozen conflict." At $119 Brent, that's exactly what the market is pricing.

How are you positioned ahead of Powell's presser? Drop your thoughts below.

-- Fi

"When the cartel fractures, the blockade tightens, and the central bank has no good options -- that's when the real price discovery begins."

Earnings after the bell really shook up the market a bit if you were day trading, but impact wasnt exactly earth shattering



META is a big loser
AMZN looks to be in a downtrend
GOOG had a great earnings and clearly wants higher
NVDA even without earnings didn't like the volatility
AAPL without earnings too but wanting higher
MSFT from green to red, will be interesting how it settles
NFLX without earnings just seemed to be following NQ
ORCL without earnings was closely following MSFT, personal bias is that they crash soon

Thursday Update -- Brent Spikes to $126, Trump Weighs New Military Strikes, and Powell Goes Out Swinging

Yesterday I said the question was what breaks first. Today we got our answer -- everything moved at once. Brent crude spiked to $126.41 overnight, the highest price in four years, before crashing back below $116. Trump is being briefed on new military options against Iran. Powell delivered his final press conference with four dissents -- the most fractured FOMC vote in years. And gold reversed hard, bouncing off $4,550 back above $4,630 as the "sell gold, buy dollars" trade finally showed cracks.

What's New

Five developments in 24 hours. Each one reshapes the outlook:

1. Brent touched $126, then collapsed $10. The June Brent contract spiked to $126.41 overnight -- the highest intraday level since March 2022 when Russia invaded Ukraine. But the June contract expires today, and as volume shifted to the July contract (trading around $111), prices pulled back hard. WTI hit $110.93 before settling near $106. The spike was partly technical (expiring contract, thin liquidity) but the catalyst was real: Axios reported Trump will meet CENTCOM Commander Admiral Brad Cooper today for a briefing on new military options including a "short and powerful" strike campaign and potentially seizing a section of the Strait of Hormuz itself.

2. Trump is considering resuming combat operations. The Axios report cited two unnamed sources saying the resumption of combat is "seriously under consideration." Options include infrastructure strikes and a partial takeover of Hormuz to restart commercial shipping. Trump told Axios the blockade is "somewhat more effective than the bombing" and that Iran "can't have a nuclear weapon." This is the clearest signal since the ceasefire that military escalation is back on the table.

3. Iran's Supreme Leader responded with defiance. Mojtaba Khamenei declared that Americans have "no place in the Persian Gulf except at the bottom of its waters" and that Iran will defend its "nuclear and missile capabilities" as national assets. He described a "new chapter" for the region. The diplomatic temperature hasn't been this cold since the ceasefire began.

4. Powell delivered his final press conference -- with a twist. The Fed held rates at 3.50-3.75% as expected, but the vote split four ways for the first time this cycle. Miran dissented wanting a 25bp cut. Hammack, Kashkari, and Logan dissented opposing the easing bias in the statement -- they wanted to signal the next move could be a hike. Four total dissents -- the most for an FOMC meeting in years. Powell announced he will remain on the Board of Governors after his chairmanship ends May 15, citing the need for "finality and transparency" regarding legal attacks on Fed independence. He carefully avoided boxing in incoming Chair Kevin Warsh, saying he's "going back to being just a governor." PIMCO called it a "hawkish shift."

5. The Maritime Freedom Construct. A State Department cable reviewed by Reuters reveals the US is building an international coalition to reopen Hormuz shipping -- a "post-conflict maritime security architecture." The diplomatic and military tracks are running in parallel now, which tells you Washington sees this lasting months, not weeks.



Market Response

The cross-asset picture today tells the whole story. WTI at $106.12 (down 0.7% from yesterday's $107 close after the $111 spike), ES at 7,182 (flat), NQ at 27,291 (down 0.1%), and gold at $4,631 (up 1.5% -- the first meaningful bounce after days of selling). The 10-year yield dipped to 4.39%, with ZN at 110.56.



The equity-oil decoupling I've been tracking all week is holding, but barely. The S&P is up roughly 17% since the war began February 27 while Brent has nearly doubled. That math is absurd at $119 -- at $126 it was approaching the point where even the most optimistic earnings growth can't justify ignoring the inflation transmission.

Tech earnings are propping up the indexes. Alphabet jumped on AI spending payoff. But Meta tumbled after announcing another capex hike. Microsoft delivered a beat but OpenAI exposure clouds the outlook. Apple reports tonight. These five companies are carrying the market while energy inflation quietly eats margins everywhere else.



Gold's bounce today is interesting. After sliding from $4,700+ to below $4,551 intraday, gold reversed hard to $4,631. The "sell gold on rate expectations" trade may be exhausting itself now that Powell's final presser confirmed the Fed is locked in place. With Warsh coming in and the FOMC split four ways, the rate path is genuinely uncertain -- and uncertainty is gold's friend.



The Fed Deep Dive -- What the Four Dissents Mean

This is the most fractured FOMC vote in years and it matters for every asset class. The three hawks (Hammack, Kashkari, Logan) wanted to remove the easing bias from the statement -- the word "additional" in "additional adjustments" that markets have read as implying future cuts. They wanted the committee to signal the next move could go either direction. Powell clarified the dissent doesn't mean anyone wants to hike. But the message is clear: a meaningful faction of the committee thinks rate cuts are off the table indefinitely.

For futures traders, this has direct implications. Rate cut expectations have been pushed to "no cuts until mid-2027" on Polymarket. The bond market is pricing persistent energy inflation. The 10-year at 4.39% is relatively contained, but watch 4.50% -- a break above confirms the bond market has given up on cuts entirely.



Powell also dropped a line worth noting: the economy is "powering through shock after shock" with consumers continuing to spend. He said the Fed hasn't observed "much slowdown yet" from higher gasoline prices. That's either confidence or complacency -- at $4.30/gallon gas (4-year high per AAA), the lag effect on consumer spending is coming. It's a question of when, not if.

Updated Outlook

The $126 Brent spike was a warning shot. Contract expiry exaggerated it, but the catalyst -- potential resumption of military strikes -- is real. If Trump greenlights a Hormuz seizure operation, the supply picture goes from bad to catastrophic. If talks restart, we could see a $15-20 unwind in Brent fast.



Key levels: CL support $103 (today's low), resistance $111 (today's high). Brent July contract support $108, resistance $115. ES support 7,134 (today's low), resistance 7,212 (today's high). Gold testing $4,630 -- a hold above $4,600 on the daily close would signal the selloff is exhausting. 10-year yield watch level remains 4.50%.

This war is 61 days old. The ceasefire holds on paper but the rhetoric has never been more hostile. Trump is reviewing strike options. Iran says Americans belong at the bottom of the Persian Gulf. Powell handed off a Fed split four ways with no good options. And Brent just printed the highest price since 2022 -- even if only for a few hours.

The next 48 hours: Apple earnings tonight, Trump's CENTCOM briefing, and the UAE formally exits OPEC tomorrow (May 1). The war enters its tenth week with more catalysts than any single week so far.

How are you positioned? What's your read on the $126 spike -- warning or one-off? Drop it below.

-- Fi

"When the outgoing Fed chair stays on to defend the institution, the incoming chair gets briefed on military strikes, and oil spikes $20 in 12 hours -- that's not volatility. That's regime change."