Market Shock: Iran Denies Ceasefire as Oil Prices Set to Explode
In a Nutshell
Markets showed little reaction to escalating Middle East tensions, with the NASDAQ forming lower highs and lower lows on multiple timeframes. The speaker closed a profitable Micron short for $13k and took a small long position into after-hours. Oil prices are rising as the ceasefire ends, setting up higher inflation, while SpaceX and Tesla both face extreme overvaluation at 360x earnings and massive annual losses despite ongoing geopolitical and earnings-driven market volatility.
These notes were generated by AI and may contain inaccuracies.
Even with tensions escalating in the Middle East overnight, markets showed little reaction. The NASDAQ during overnight hours gained 86%. During normal trading hours, markets opened in the green, pushed up to make new highs, then quickly corrected. The session formed a lower high before selling off for the remainder of the day. The 5-minute timeframe showed consistent lower highs and lower lows, confirming the bearish direction. The speaker noted that carrying positions from Friday to Monday required taking profits shortly after markets opened, otherwise gains were largely given back resulting in a near break-even day.
The speaker closed their short position on Micron before markets closed, with the last short entered around the 900 level. After confirmation, additional positions were added, and profits were taken early rather than letting the position run to the 860 lows. The speaker emphasized playing it safe after already exceeding their daily goal significantly. Profits were taken as the price approached the previous support level of approximately $870. Total profit realized was $13,279 for the day.
The speaker's last trade was to go long, buying the dip during aftermarket hours. As the price recovered, the position was trimmed and then fully sold, leaving one share. The average purchase price was approximately 874.60. The trading platform used is Webull, with an affiliate link available in the video description for sign-up bonuses.
Market sentiment for memory chips and semiconductors has been choppy. The speaker noted uncertainty about the week's direction due to several major Magnificent 7 companies reporting earnings. Alphabet (Google's parent company) and Tesla are scheduled to report on Wednesday, with live streams planned for both. Other companies reporting include ServiceNow, IBM, and Intel, all significant in the AI space.
The United States is moving closer to all-out war with Iran, marking the 10th consecutive day of one of the hardest attacks against another country. Oil prices remain elevated, and markets are trending slightly lower. This situation is occurring before inflation begins to rise again.
The ceasefire from last month allowed oil to flow through the Strait of Hormuz, which brought oil prices down, lowered gas prices, and reduced inflation. For July, average gas prices are rising, oil price per barrel is increasing, and inflation is likely to follow. This will be reflected in upcoming inflation reports.
The speaker clarified they are not attempting to instill fear about inevitable market drops, acknowledging markets are irrational and quick to recover, especially with positive signals from Trump. The key message is to pay attention to direction: markets attempt recoveries but face rejections with lower highs and lower lows.
On the NASDAQ, the price is at a previous oversold range with common support around 680 to 690, extending to the $700 level. A common resistance range exists above. The daily chart presents a different perspective than shorter timeframes. Breaking support could lead to a retracement based on previous lows from late March 2026, specifically March 30th. Different timeframes provide different perspectives on potential outcomes.
SpaceX is now trading below $120 per share even before private and original investors can sell. The stock is down 47.6% and over 50% from previous levels. The speaker questioned whether it is crazy that a company losing $4-8 billion annually is not worth $3 trillion, or whether the prior $3 trillion valuation was the irrational assessment.
At a $1.57 trillion market cap, the speaker considers the stock still overvalued given current fundamentals. Kathy Woods is dollar-cost averaging on the way down, hoping for a dead cat bounce. The speaker notes she runs one of the worst-performing hedge funds and advises setting alerts and being cautious about buying before signs of confirmation.
The stock is oversold technically, but the speaker warns that cheap can always get cheaper. They are not shorting due to risk-reward considerations and potential for V-shaped recoveries if broader markets recover, but also have no interest in buying without reversal confirmation. A potential swing trade could be considered only with clear signs of reversal, and only as a very light position.
The speaker expressed admiration for Elon Musk as one of the greatest minds of the generation but stated no need to pretend the companies he runs are highly profitable. Tesla trades at nearly 360 times earnings, valued over a trillion dollars while producing only $3.9 billion in net income, with expectations for this figure to decline further.
The loss of government subsidies, tax credits, and customer incentives leaves Tesla without external support. The speaker questions the delivery timeline for promised products including the Tesla Roadster (nearly 10 years delayed) and the Optimus robot. Tesla is scheduled to report earnings on Wednesday, July 22nd.
Earnings per share are expected at 52 cents. Revenue is projected around $26 billion. The speaker noted that Tesla consistently receives lower growth expectations compared to other Magnificent 7 companies like Meta, Microsoft, Google, Nvidia, and Amazon, which are expected to deliver strong results. Tesla earnings are described as weak relative to the company's valuation and hype.
The speaker expressed interest in whether the hype cycle continues or if the stock begins to reflect actual performance. Markets are positioned to retest previous highs amid ongoing geopolitical developments and earnings season.
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