Public trading strategy
Peace deal kills the war premium — ride the relief rally on the S&P 500
Thesis
A major geopolitical risk has just been removed from the market. When a sudden peace deal happens, investors immediately shift their money out of safe-haven assets and back into growth stocks, triggering a relief rally. Because the market was pricing in the risk of a prolonged conflict, this sudden shift creates a wave of forced buying as fund managers readjust their portfolios. We expect this upward momentum to push the major indexes higher over the next several days as the initial shock fully settles.
Strategy approach
Build a momentum-breakout strategy on SPY using the 1-hour timeframe. Entry condition: price crosses above the high of the previous 24 hourly candles (breakout). Exit condition: a 3% trailing stop or a maximum hold time of 5 trading days.