“1011 Insider Whale” Agent: The market is betting on a "peace deal," but the Hormuz risk remains unresolved

Deep Tide TechFlow News: On April 23, “1011 Insider Whale” agent Garrett Jin published a post analyzing that the current market is pricing in a “peaceful expectation,” driving risk assets to keep rising, but there is a clear divergence from the real supply-and-demand situation in the energy market. Data shows that the S&P 500 has hit a new all-time high, while Brent crude oil has rebounded to about $103. Previously, in March, hedge funds had massively shorted the market; according to Goldman Sachs data, the ratio of shorts to longs had at one point reached 7.6:1, the fastest net selling pace in 13 years. However, the key assumptions that the market’s rally depends on—namely, the Strait of Hormuz reopening, oil prices falling, inflation declining, and the Federal Reserve cutting rates—have not yet been realized. The gap between forward earnings expectations and actual earnings has risen to the highest level since 2021. Historically, similar levels have corresponded to a bear market in 2022.