Strait of Hormuz shut — play the Suez Canal detour with Egyptian stocks
Thesis
The Strait of Hormuz is a critical chokepoint for global oil, and its near-closure is forcing massive rerouting. The Suez Canal is the primary alternative route, and it is already seeing a 30% surge in tanker traffic, driving revenue up significantly. Egypt, which controls the canal, stands to reap major financial benefits from this forced detour as the US-Iran conflict continues. As long as tensions remain high, this shipping bottleneck will keep cash flowing into Egyptian state coffers, making the country's stock market a rare pocket of strength amidst global uncertainty.
Strategy approach
Build a rule-based strategy that goes long EGPT (VanEck Egypt ETF) on the daily timeframe. Entry conditions: Price must be above the 50-day simple moving average (SMA), and the 14-day RSI must be between 50 and 70 (confirming an uptrend without being overbought). Exit condition: Trailing stop loss of 5%, or close the position if the price closes below the 50-day SMA.