Black trading gold

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  Martin Raab
  Investment-Stratege

Brief, loud and brutal as a thunderstorm, the “Epic Fury” and “Lion’s Roar” operations shook Iran and the global energy markets. Within 48 hours, the price of oil – Brent Crude and WTI – shot up like a mullah’s rocket towards USD 75 per barrel. When it became clear that the Strait of Hormuz was closed to cargo ships for the time being, panic set in. Mainly due to the lack of insurance cover.

Intraday volatility on the oil market is uncontrollably high; the smoke is thick. Experienced traders are already starting their warm-up. The “war premium” traditionally disappears quickly – within days or even hours. The usual suspects from the hedge fund scene in the energy sector are currently working 24/7 on pizza and cola. Many long derivatives have already been sold today (profit-taking). Now begins part 2 of the actual trading opportunity: “The downturn”. For risk-aware traders, Futures, Futures Options and Mini Futures shorts are not a risk, but an opportunity to achieve high profits.

The mechanics are simple: from the expected price peaks of USD 85–90 for WTI, the oil price is set to fall sharply. Until then, the “Crude Sharks” will wait patiently with their algorithms. Short products on oil benefit disproportionately when the underlying falls. The leverage – depending on the Knock-out barrier or strike price – transforms a moderate decline of 10% (e.g. USD 8 from USD 80) into a substantial profit. An exposure of USD 100,000 can quickly multiply many times over. The timing of entry and clear stop-loss limits are crucial. Professionals pay attention to resistance and support zones in intraday trades; Fibonacci retracements help with this.

Those who prefer a more measured approach can trade Futures Options via Swissquote or Interactive Brokers and sell initial short puts. This allows for a high volatility premium to be achieved. A sensible strike price – i.e. sufficient downside distance – is crucial. Strikes that are too close to the current price can quickly turn a supposed “winning strategy” into a fiasco. Professionals know: oil trades in the new “Gulf War III” are neither a one-way street nor a sure-fire success. The market can remain irrational for longer than many traders can stay solvent. Professional position sizing is therefore essential. However, it is already clear to many hedge funds: the profits in the summer of 2026 could be exorbitant. Carpe pretium!