More Pain Ahead: CTAs "Sellers In Every Scenario" As Lack Of Liquidation Flush Keeps Biggest Traders On Edge

Stocks stormed higher, closing up 0.83% on the day as oil plunged as much as 30% from its overnight highs after President Trump said he would waive oil-related sanctions, have the US Navy escort tankers through the Strait of Hormuz and predicted that the war with Iran would resolve “very soon” as he confronted mounting economic and political pressure and days of dramatic fluctuations in oil markets. Sentiment was also lifted after the president said he didn’t believe the conflict would be over this week, but insisted the operation was ahead of schedule and looked to shore up investors increasingly concerned about energy prices. He vowed bombing “at a much, much harder level” if Iran disrupted oil supplies.

While it remains to be seen how Iran will respond to Trump's latest comments, it is clear that the market saw it as a potential "off ramp", something that was affirmed by a WSJ article late in the day reporting that "Trump Advisers Urge Him to Find Iran Exit Ramp."