Public trading strategy
Iran targets US positions after American strikes — oil momentum play
Thesis
A direct military exchange between the U.S. and Iran — combined with Iran explicitly targeting U.S. positions in retaliation — signals a massive escalation in the Middle East. With oil traders already weighing disruptions in the Strait of Hormuz after a cargo ship attack, energy markets are pricing in a severe risk premium. Even if full supply disruptions don't materialize immediately, this level of geopolitical uncertainty typically drives a sustained momentum rally in oil and oil-related stocks.
Strategy approach
Build a rule-based momentum strategy on USO that enters long when price closes above its 10-day high on a day when VIX rises >5%. Exit when USO drops below its 5-day low or after a 15-day max hold.