US Launches Operation Epic Fury on Iran - How Will Markets React?

 

US Israel Launch Attack on Iran timesnownews.com

Over the weekend: US launched Operation Epic Fury against Iran, with the help of Israel:

• $VIX (fear gauge) has been riding high for weeks.

• Crude Oil has been on a tear touching a new recent high on Friday.

• Gold still clinging to  $5000 (closing above $5250) like Trump owes it money

My only question on the situation is, what took so long? Iran has been a thorn in our side since the the Shah of Iran fled to the United States in October 1979 after being overthrown during the Iranian Revolution. He sought medical treatment for cancer, but his arrival contributed to the storming of the U.S. Embassy in Tehran shortly thereafter. Of course after having just wrapped up the highly unpopular Vietnam war, America was in no mood to go to war again, and Jimmy Carter was weaker than Joe Biden in a foot race.

In Trump's video address Saturday:

“We are going to destroy their missiles and raze their missile industry to the ground, It will be totally obliterated” the president said. “We are going to annihilate their navy, we are going to ensure that the region’s terrorist proxies can no longer destabilize the region and the world.” (many sources) 

"The lives of courageous American heroes may be lost and we may have casualties. That often happens in war."

Markets don't like uncertainty, and this action certainly removes the what if factor. Of course the leftist msm will root for Iran, we already see them front running the story with reports that Iran is retaliating. Iran would be smart to surrender immediately. 

How Will Markets React 

• The unwind of the defensive sector rotation
• Possible spike on the $VIX overnight Sunday Futures followed by an unwind of the fear trade. 
• We may see a knee jerk reaction in Sunday futures trading, and a spike in Gold, but I think we could see a rally in US equities. This geopolitical clarity could be the catalyst the market needs to shake off the lingering AI fear trade, and pull cash off the sidelines, sparking risk-on sentiment. 

March comes in like a lion, and out like a lamb 

  

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