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Oil Dumps, Stocks Jump As More Ships Cross The Strait; Bitcoin Up, Gold Down Again

Tyler Durden's Photo
by Tyler Durden
Monday, Mar 16, 2026 - 11:36 PM

Tl;dr: As the Iran war enters its third week, and despite some destructive escalation over the weekend, the market is trading with an optimistic bias today (reminding us of last Monday's price action) amid hopes for easing transportation threats through the Strait. Oil down means stocks up, thanks to major short squeeze (and optimism about NVDA's GTC event). The dollar and gold slipped lower (less safe-haveny demand) but bitcoin was aggressively bid. Bond yields fell alongside oil prices, with all correlation regimes remaining fnorked for now. Bear in mind that today's gains were on low volume and backed by put-selling - not a full-throated buying panic.

As Goldman's Bobby Molavi noted earlier, the last couple of weeks have been a strange mix of calm, panic, pain, hope, fear, more panic, more pain and some confusion.

It is rare that the asset management industry across public/private, systematic/fundamental or hedge/long have had to try and navigate regime change, geo political upheaval, conflict and conflict escalation, domestic political shifts, transformational tech, tech disruption in a period where cross asset correlations and cross asset volatility are shifting this much and this quickly. The number of cross currents that are at play and affecting markets and asset prices feels unprecedented.

The geo-political and macro impacting the economic and micro more than ever. Fundamentals competing with themes and narratives.

Positioning and sentiment moving markets with a velocity that is hard to manage. 

Read about all today's geopolitical goings-on here...

Oil

But, with all that in mind, we'll address the macro-driver-of-all first: here's what triggered oil's moves today...

  • Overnight: Oil opened higher on Kharg Island chaos, but faded quickly as hopes for easing Strait of Hormuz shipping grew

  • European session: comments from the Iranian Foreign Minister that the US has already learned a good lesson sparked some hopes of an off-ramp forming - prices extending losses

  • Early Morning: Bessent reassured that every effort was underway to strengthen support for transit through SoH, adding that some ships (Iran/Pakistan/China) had crossed with US letting that happen - oil prices legged lower

  • 0930ET US equity open sparked a bid (no HL drivers) - oil rebounds modestly

  • 1230ET *TRUMP: IRAN HAS PEOPLE WHO WANT TO TALK - oil price reversed gains

  • 1310ET *TRUMP: THINK WILL GET STRAIT OF HORMUZ GOING VERY SOON - price accelerated lower

  • 1420ET *ISRAEL ESTIMATES IRAN SEEKING TO REACH DEAL QUICKLY, IRAN FM ARAGHCHI & US ENVOY WITKOFF IN CONTACT VIA TEXT MESSAGES IN RECENT DAYS - oil dumped to the lows of the day

  • 1500ET Brent Settles above $100 for 3rd straight day - oil rallied after settle

  • 1530ET IRAN & US IN DIRECT CONTACT IN RECENT DAYS - AXIOS - oil tumbles

  • 1550ET *TRUMP GETS OPTIONS TO END IRAN WAR DAILY: NBC - oil extends losses

The result of all that was WTI pushed back down below $94 from above $102 overnight...

The official data shows negligible activity through the Strait (but we have not seen any confirmed attacks on oil tankers in the region since March 11th)...

..but some (untagged) ships are getting through...

While the SoH is open-ish and the Trump admin appears to looking for an off-ramp... Options and prediction markets are implying only a ~50% chance of a ceasefire within 2 months...

...the implications of this stoppage (and the subsequent shut-ins - production and refinery) mean there is likely still more pain and consequence to come from notably elevated oil prices for now (JPM fears commodity shortages and an inflationary spike).

Staying in the energy complex, perhaps this will speed up Trump's off-ramp - as pump prices just surged by their most on record and look set to go higher still..

Stocks

But, as we noted, oil down means stocks up and correlation-1 across the major indices in the US.

Around 1500ET, this HL hit from GTC: "*NVIDIA EXPECTS TO GENERATE AT LEAST $1T IN REVENUE THROUGH '27" and stocks kneejerked higher, but that did not last long.

By the close, all the majors were up around 1% with The Dow a small laggard...

Note that all the majors fell back to their cash open levels after the NVDA fade...

...notably decoupling from crude...

The cash open was sponsored by a big short squeeze which was faded (similar to Friday) before another squeeze as trump spoke lifted 'most shorted' stocks back to their highs of the day...

Goldman's trading desk points out that activity levels are quiet to start the week at a 2 out of 10. Overall desk is 4% better to buy. 

  • LOs are 6% better for sale on small notional. Selling TMT, and Industries. 

  • HFs are 7% better to buy with a majority of that led by macro products. No surprise as ETFs shorts rose at one of the fastest paces on record in our PB data last week. 

And we warn that we have seen this pattern before as today's gains were dominated by put-selling from 0-DTEs...

Source: SpotGamma

NVDA's big brag on trillion-dollar revenues did not juice stocks as much as many had hoped (that's a $300bn roundtrip intraday on that spike)...

Equities have revised lower their implicit pricing of the US economic growth outlook...

Before we leave equity-land, Goldman's Chris Hussey reminds us that today's more pro-risk price action, which is happening in spite of any concrete details (no deals yet, no more reserve releases yet) is another callback to a cardinal rule of the Pandemic 101 playbook: markets cannot afford to wait for a resolution to a problem that they know will eventually be resolved.

And while this rule initially came back into play a week and a half ago, before being overshadowed by more oil price volatility, the forward-looking nature of equity markets, plus the potential for action (resolution) seems to be back in full effect today.

Everything Else...

Treasuries were bid alongside stocks (as oil removed some inflationary angst) with the belly of the curve outperforming...

The dollar dropped on the day, erasing Friday's gains...

Despite the dollar weakness, Gold dipped on the day, oscillating around $5000 (well down from the start of the war)...

Bitcoin extended its recent gains, rising back above $74,000 to its highest since the start of February...

Ethereum outperforming bitcoin (up by around 10%), breaking above its 50DMA (thanks to flows from BlackRock's new staked ETH ETF)...

Since the war started, we have seen that pattern (gold down, bitcoin up) play out...

...as significant reverse in a long-term trend of gold outperforming...

Finally, ETFs continue to drive the action in the tape. 

On Goldman's prime book last week, ETF shorts rose sharply for a 2nd straight week and at one of the fastest paces on our record. ETFs have accounted for more than 35% of the overall tape for 11 consecutive session which is now the longest streak in Goldman's data set. 

Alongside the streak above, the 10-day average of ETF’s share of the tape is at its second-highest value in our dataset (38%). 

Geopolitical uncertainty is undoubtedly the largest driver here, triggering hedging activity and tactical positioning (both of which rely on the tradability of ETFs... i.e., USO posted another record notional week of trading volume, with $59 billion worth of paper changing hands).

But, for now, the geopolitical crisis is playing out as usual...

But the dip-buyers are not backed by volume: Oil still above $100 (Brent), low volumes, put-selling-driven gains. 

CTA are forced sellers for the week...

  • Flat tape: Sellers $66.18B ($34.73B out of the US) 

  • Up tape: Sellers $33.01B ($17.54B out of the US) 

  • Down tape: Sellers $74.73B ($34.56B out of the US) 

Keep buying the dip? Or is it different this time?

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