Markets Buying the Headlines

Key Takeaways

• Oil dropped sharply and cracked a support level in the past day as markets reacted to the latest US-Iran deal headlines.
• US stocks rallied on the same news, despite this being roughly the 39th time a similar deal announcement has surfaced.
• The deal’s status is contradictory: Trump says it has been approved at the highest level of Iranian leadership, while a senior Iranian official says no framework has been agreed.
• Gold has broken below its 200-day moving average for the first time since October 2023, a significant technical move, though it is entering an area thick with price floors.

Despite the TACO jokes and constant back-and-forth supposed deals followed by dramatic threats, markets have still been eating up headlines. While some news reports highlight the fact that Trump’s latest news about a potential deal has just reached number 39, that has not stopped investors from responding.

In the last day, oil has taken a dive and seems to have cracked a support level:

And US stocks have gotten a breath of fresh air:

Depending on which news story you read, the latest deal is either signed, not signed, or waiting to be signed. The first casualty of war is said to be the truth, so it is no surprise that leaders are making opposing announcements. The current deal seems to be looking approved by the US side, and looking neither approved nor disproved by the Iranian side. In the current landscape, it seems that this is very good news.

Some positive developments that support the above are that Trump’s major military strikes were recently called off. Media has reported that “major gaps” in the proposed agreement have also been fixed. The deal still depends on a sign-off by Iran’s Supreme Leader. Again, it is worth noting that this is the 39th time a similar announcement has been made. This also depends on other parties involved in the conflict agreeing and ceasing escalations.

Gold has recently broken below its 200-day moving average, which is considered a significant move. It is entering into an area thick with price floors, however. The best thing for gold and silver would likely be a peaceful weekend. This could help knock oil prices further down and give central banks more reason to support the money supply. For investors watching these levels, Gold Silver Standard and Ainslie Bullion both offer ways to hold physical metal through periods of volatility.

This article is general information only and does not constitute financial advice. Past performance is not indicative of future results. Always conduct your own research or consult a licensed financial adviser before making investment decisions.