r/stocks
The cancellation of Iran attack changes nothing about the underlying reason for the current sell off.
Author warns the relief rally on canceled Iran attack is temporary, as underlying reasons for the prior market sell-off remain unchanged.
- The underlying reasons for the recent market sell-off remain completely unchanged despite the geopolitical relief.
- The cancellation of the attack is merely a non-event that prevents things from getting worse, not a fundamental positive catalyst.
- There is no confirmation that any deal has been accepted, making the geopolitical outlook still highly questionable.
I'm see euphoria posts abound as we got a spike on that reversal of decision, but I think people forgot we were in a sell off prior to this and those reasons didn't change because of this. Everything is exactly as it was. It just didn't get worse. We rose to new highs with no clear end on war escalations in sight so there was no fear in the market for these possibilities. We began selling off for various other reasons, but war escalation wasn't one.
Today, the market barely reacted to his original truth post this morning and mostly went sideways and then, on the cancellation, we run up. Those sells didn't come from anything escalation related yet the non-event was bought. There is no confirmation that any deal has been accepted so far and we've been down this road before, so even that prospect is currently questionable.
Thoughts?