🚨 I’ll be live at 10 a.m. ET with Graham Lindman🚨
We’ll cover how to set up two-way trades — the VIX is down some and we expect bigger trades and better prices to come from developments in Iran [tap to join us for Opening Playbook]
Here’s something that’s been on my mind — and probably yours too if you’ve been watching the news cycle. Trump tweets about Iran peace talks, Iran denies it happened, markets move, and then nothing is clear.
So what actually happened, and more importantly for us as traders, how should markets price this in over the next 24 to 48 hours? I think there are three potential scenarios on the table, and each one carries very different implications for how this plays out.
He might have simply said he’s planning to have talks with Iran, then went ahead and tweeted like it already happened. It’s a classic move — I was going to do it anyway, so why not announce it as if it’s done — and if that’s the case, the market is reacting to something that hasn’t actually occurred yet, which creates a completely different risk profile.
The second possibility is that talks did happen, but Iran doesn’t want that out there because it doesn’t want to come off as weak, so it denied it and put distance between itself and the narrative. I don’t think this is the most likely outcome, but it’s worth considering because if it’s true, the breakthrough is real — it’s just being managed carefully for optics.
The third — and what I think might be more probable — is that they simply want out and are framing it as a resolution instead of admitting they’re bailing. If that’s the case, then this becomes less about diplomacy and more about narrative control around an exit that was already in motion, which leaves the market struggling to confidently price any of it in.
The Volatility Backdrop
All of this uncertainty is amplified by the broader market environment, which is already stretched and vulnerable to larger moves. When the market closes more than 2% down and the VIX is over 25, nearly 80% of the time the following week also sees a net move greater than 2%, which tells you volatility doesn’t just spike — it tends to carry.
That backdrop matters because it means this Iran situation isn’t happening in isolation — it’s layering on top of an already fragile setup. And in environments like this, it’s often not the news itself that drives price action, but how traders feel about the news, with sentiment shifts hitting the tape far harder than the headlines themselves.
How I’m Trading This
So where does that leave us? For me, it’s a challenging and selective environment where patience matters more than prediction. I’m mostly sitting on cash and taking only a few targeted shots, primarily using condors or broken wing butterfly structures to stay defined and flexible.
It’s not the time to be a hero with oversized directional bets — it’s the time to stay adaptable and let clarity come to you. Right now, we’re in a holding pattern, waiting for the next piece of information that tells us which scenario we’re actually in, and until that shows up, the market is likely to keep struggling to assign meaning to any of it.
Now don’t forget to join us at 10 a.m. ET weekdays for Opening Playbook, and at 3:30 p.m. ET Closing Playbook!
Nate Tucci
Tucci Trades
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