An unexpected event occurred just 15 minutes after the market opened

Source: Wall Street Intelligence Circle

Another “gap” appeared as global markets opened on Monday:

- Gold and US stock futures opened lower, with gold prices dropping below $4,700 at the open;

- Crude oil and the US dollar surged, with US crude oil breaking above $96.

The market reacted to the failure of US-Iran talks over the weekend. Trump canceled his senior envoy's visit plan, while Iran stated it would not engage in negotiations as long as it felt threatened.

Surprisingly, the market quieted down just 15 minutes after the open. However, this is an unsettling calm. If the market had experienced sharp volatility at the open, it could have absorbed some of the market's emotion, potentially stabilizing subsequent movements. But with a relatively slow start this Monday, it foreshadows that during one Asian or European trading session, market volatility may suddenly erupt. Entering the evening New York session, a third round of volatility could occur.

The market hasn’t digested the risk; no one is willing to place aggressive bets first, so volatility has been suppressed. But the risks themselves remain, and are even more complex than last Friday: US-Iran talks have failed, the Strait of Hormuz risk is unresolved, oil prices remain high, and major tech earnings are due this week. This means that currently, both “safe haven logic” and “risk chasing logic” coexist in the market.

Bloomberg has rarely published three consecutive articles within the last 10 hours, which in itself is an unusual move (suggesting that the rally has itself become a risk):

"Record-Breaking Rally Sparks Skepticism": The market is now moving forward at 120 kilometers per hour; when a lane change is truly needed, there may not be enough reaction time.

"Bond Traders Closely Watch Rate Decisions for Sell Signals": The world’s most important central banks may give investors new reasons to sell government bonds.

"Investors Flee Stocks, Betting on Higher Rates": As stock markets hit new highs repeatedly, some investors are following the adage, “hedge when you can, not just when you have to.”

Be careful with everything.