Key insights
- The author believes geopolitical factors (Iran) and market dynamics (CTA positioning) point to an imminent market correction. They argue that Iran is incentivized to delay a deal until market weakness forces the US to accept unfavorable terms. Additionally, they suggest that overextended algorithmic trading strategies and recent volatile sessions without upside indicate a market top, increasing the likelihood of a significant sell-off.
Ghalibaf is making it clear on his X that he's watching US News cycle on markets. Markets being up = he has more leverage. Markets going up into midterms = big leverage.
He knows Trump has no good options so he can extend the pain. There won't be a deal until markets drop big and oil spikes again, forcing Trump to accept the worst possible deal.
The second scary thing for bulls is repeat huge volatile days with no upside. It means CTA & Momo algorithms are already fully long and there are no more buyers. Sudden 10% drops in entire indexes means top heavy and ready to dump.
Be wise ... Sell or be sold to. We will revisit the lows of the year soon.