Public trading strategy
Middle East conflict disrupts oil routes while megabanks get stress-test green l
Thesis
The U.S. strike on Iran over a Strait of Hormuz ceasefire violation directly threatens global oil supply, pushing crude prices higher. Simultaneously, the stress test results allowing massive bank buybacks provide a safe haven in financials. By connecting the geopolitical tension in the Middle East with the regulatory green light for capital returns, a portfolio long energy and banks is positioned to benefit from both the supply-side oil shock and the defensive strength of well-capitalized mega-banks.
Strategy approach
Build a strategy on D1 that enters long XLE when WTI crude oil makes a 5-day high and enters long JPM when it is within 2% of its 20-day high. Include a 15% trailing stop and a 30-day max hold period.