To deal or not to deal... (sorry Hamlet)
Trump will announce tonight, at 1800 GMT, details on the Iran nuclear deal. A decision was not due until the 12th of May. Why has Donald Trump brought it forward? Donald Trump had a flurry of Euopean visitors: Macron, Merkel and even Boris Johnson went over. Seems like he didn't want anymore visits. However, it seems that the latest visit from the UK's foreign minister, Boris Johnson, has been a home goal in the persuasion game. Boris Johnson come back, seemingly having been persuaded by Trump, stating that , 'we need to be tougher on Iran'. Good old Boris, always there in the thick of it. Trump has obviously now decided what he is going to do and he doesn't want any more leaders coming over. His mind is made up.
So what could happen. In a short there are a lot of options. Check out Justin's excellent post earlier for a run down of some of the options Trump has as well as Iran's possible reaction.
Earlier oil was down around 1.24% on the day as Oil traders take profit ahead of the decision. Oil has risen 25% from 2018 lows in February, so what was the point in holding for more with so much uncertainty. The sell off in oil today has weighed heavily on CAD and I jumped out of USD/CAD shorts early seeing the writing on the wall.
Tension is elevated, risk is high. Be careful and manage risk. Be watchful and look for a settled direction. Give it time. EUR/JPY looks interesting for a longer term trade should we be spooked by Trump tonight. I took profits earlier on a short, well makes up for my USD/CAD lost , sigh. Before I go, see Justin's post earlier on the EUR/JPY.
