Forget the jobs number. Forget the jobless numbers and forget the nonfarm payrolls. Well, almost anyways. This week, the entire market is being held hostage by the Iran US/Israel conflict and whether or not optimistic claims of a peace deal really are true this time.
DJT, the boy who's cried peace more than any boy ever cried wolf, stated over the weekend that a deal was once again close. Whether or not this is an attempt to put markets into overdrive on Monday or some type of MAGA 4D chess in geopolitics remains to be seen. One thing is very clear however, and that is the glaring truth of the matter is that Iran is the only thing that matters.
Everything else; the JOLTS report, the Fed speakers, even Friday's payrolls, takes a back seat. Those are footnotes and will barely move the needle compared to an unhinged tweet declaring "peace in our time." The headlines are written in the Strait of Hormuz, and until that situation resolves one way or the other, no economic print is moving oil in any meaningful way. Such a claim of peace should be greeted with as much caution as Chamberlain's famous and more famously wrong claim in 1938.
Let me walk you through what actually matters this week.
The Iran deal is the only story that counts
Oil's elevated price sits squarely on the shoulders of one unresolved question: peace or no peace. Over the weekend both sides exchanged proposals to revise the ceasefire draft and reopen the Strait of Hormuz. Trump is suggesting a memorandum of understanding could come together as early as this week. Tehran, meanwhile, reportedly suspended communications with Washington over Israeli action in Lebanon.
So which is it? Nobody knows. And that's the point. The battle in the Middle East has become a war of information as much as a war of munitions.
This is a hurry up and wait market, and in this instance, trying to play a headline is tantamount to becoming cannon fodder in this war of fake news. Getting the truth from a situation built on layers of diplomacy, posturing and outright lies is a fool's errand. Worse yet is the notion of basing financial decisions on perception will almost always be a mistake.
Trading should not be a gamble, but taking calculated risks on probabilities that are in your favour. Whether pro Israel/USA or pro Iran, traders are well advised to play price action rather than news reels. In the coming weeks, one thing is for certain and it may indeed be the only certainty; headlines mislead but candles give us the straight goods. All we can do is be positioned for any outcomes, using very tight stops even on seemingly momentous news. These headlines are laden with traps and margin calls await.
My advice for traders playing the news until this war concludes? DON'T.
Why the jobs data barely matters
Normally a JOLTS opening or a payrolls miss gives oil and the dollar a real shove. Not this week. The inflation story is already locked, and it's not coming from the labour market. It's coming from energy.
Look at the numbers. April CPI came in at 3.8%, the hottest since May 2023. Energy alone jumped 17.9% year over year, the steepest since 2022, driven almost entirely by the Iran oil shock. The Survey of Professional Forecasters now expects inflation to hit a downright thieving 6% in the second quarter, and just three months ago that same panel was forecasting 2.7%. Even still, against all logic, the major indices seem oblivious and race towards the heavens.
A soft jobs print isn't going to override that. The market has bigger fish to fry. Iran peace.
The bond crisis nobody wants to talk about
One of the scariest parts of the current financial uncertainty is that this particular room has two elephants in it. The obvious Iran quagmire being one, and the other flailing pachyderm the bond market. The credit risk of the world's biggest borrower is becoming a real question, and its credit failure threatens complete collapse that could render even Iran peace a trivial afterthought.
The 10 year Treasury yield is sitting around 4.46%, brushing up against its 2026 high. Markets have all but abandoned hope of rate cuts and are now pricing the possibility of a hike before year end, with virtually no cuts expected through 2027. That's a stunning repricing for an economy that spent years addicted to cheap money and what looks very suspiciously like fake numbers in key reports. (But I digress.)
When the safest asset on earth starts demanding a higher premium, you pay attention. The virtual silence on this matter from mainstream news on the growing bond crisis is understandably deafening, for if the truth be widely known a rush to the exits would surely ensue.
What this means for metals
Put it together: inflation running hot, energy driven, with a 6% Q2 forecast on the table. Bond yields elevated and trust in Uncle Sam evaporating as fast as Iranian peace deals.
Even in the face of peace, inflation is virtually a lock at this point, with much of the oil producing infrastructure destroyed or heavily damaged. The energy shock has already worked its way into the system, and you don't unwind 17.9% energy inflation with a single handshake and oil refiners and pipelines blown to bits.
That makes the outlook for metals fundamentally positive.
Gold is trading around $4,490 an ounce as we open the week, off its recent high near $4,770 but up roughly 34% over the past year. The pullback we've seen recently is exactly the kind of move I watch for. It isn't a reason for panic, but a reminder that even strong trends breathe. Structurally, with inflation entrenched and real yields under pressure, the case for gold holding its bid stays intact.
I'm not calling a number, but I can tell you where the wind is blowing.
How to trade this week without blowing up
This is a headline driven week, and headline driven weeks wreck undisciplined traders. The temptation is to chase every Iran rumour, every Trump statement, every flash of red or green. Don't. Let sustained price momentum be your guide, for there's truth in them thar candles.
Pick your levels. Know where you're wrong before you're in. And let the market come to you rather than chasing it into the noise. The traders who survive weeks like this aren't the ones who watch ZeroHedge doom and gloom reports or all is fine commentary from MSNBC.