🚨 I’ll be live at with Alex at 2:30 p.m. ET🚨
We’ll cover the specific market flows Alex is tracking as stocks rally on headlines of a potential end to the Iran war, a recap of recent top-performing setups, my strategy for trading gold ahead of next month’s Fed meeting under new Fed Chair Warsh and more [tap to join us for Profit Panel]
I was scrolling through headlines at lunch and something jumped out at me. Guinea — the West African country between Sierra Leone and Mali — announced it’s cutting back on bauxite exports to push aluminum prices higher.
At first glance, that should matter. Bauxite is the rock that contains aluminum, and Guinea produces a lot of it.
But aluminum isn’t like copper or oil. It’s one of the most abundant metals in the world, bound up in soil almost everywhere.
Bauxite deposits are global, and anytime one region tries to squeeze supply, another region usually steps in. That alone limits how much impact any single country can have on price.
And here’s the kicker: Aluminum prices had already moved higher before the announcement, which tells you most of the move was likely baked in.
When a commodity rallies ahead of a policy shift, the market has usually already made up its mind.
The Middle East Connection
Guinea sends a large share of its bauxite to smelters in the Middle East, clustered around the Strait of Hormuz. Those facilities have their own headaches right now because of regional tensions and shipping chokepoints.
When your key customers are already dealing with transportation slowdowns, export cuts don’t hit the market the way you’d expect. Even if Guinea wants to tighten supply, getting material where it needs to go has become its own challenge.
So when I saw the news, I figured Alcoa (AA) would jump. Less supply, firmer prices, strong setup. But that’s not what happened. Instead, it looked like the classic situation where traders bought the rumor on the way up and sold the news once the headline finally hit.
The Reality Check
AA has been struggling with the same ceiling for a while now. That $75 to $76 area has rejected price more than once.
Until buyers can push through with real conviction, the stock is likely to keep losing steam every time it reaches that level. Repeated failures at resistance often lead to pullbacks unless something meaningful changes the story.
And lately, strange dynamics have been showing up across the entire commodities complex. Crude oil might be heading higher while gasoline falls.
Metals can show strength while gold and silver weaken. Relationships that normally move together aren’t even speaking the same language.
When markets start behaving like that, the “logical” trade setups often become the ones most likely to burn you.
Trader’s Rule: When the most obvious trade doesn’t work, it’s usually because the market already moved without you. Don’t chase headlines — trade the setup, not the story.
Keep your levels tight, stay patient and let price confirm the move before you jump.
Geof Smith
Geof Smith Trading
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
P.S. The Warsh Handoff and The ‘Ripple Effect’
Something important just shifted… and most traders aren’t paying close enough attention.
Jerome Powell has likely stepped up to the podium for the last time.
And now, control is being handed off to Kevin Warsh… a transition that could quietly change how the market reacts to policy, liquidity, and risk.
That kind of handoff doesn’t just stay in Washington…
It tends to ripple through stocks in ways that aren’t obvious at first – but very clear once positioning begins.
That’s what has me paying attention right now.
Because beneath the surface, there’s already one ticker starting to reflect this shift.
And if this plays out the way similar transitions have in the past… the move could come quicker than most expect.
I don’t say that lightly.
No trading guarantees, of course.
But this is the kind of moment where being early matters.
And if you’re going to be involved in this market over the next few weeks…
You’ll want to understand what’s happening here.
