Overnight, while the US slept

Records everywhere, and oil did it: US equities put in a blowout session. The S&P 500 closed +1.79% at 7,737 — its first record high in two months. The Dow added 907.47 points (+1.71%) to 54,085.88, its first close ever above 54,000. The Nasdaq Composite led, +2.59% to 26,584.99. The trigger was diplomatic, not earnings: Treasury Secretary Scott Bessent told CNBC a deal to reopen the Strait of Hormuz could land "today or tomorrow," and West Texas Intermediate crude promptly settled down 5.1% at $80.34 — back below $80 intraday for the first time in weeks.

Rates & DXY: The 10-year Treasury yield fell almost 6 basis points to about 4.688%, and the 2-year sits at 4.21%. But look at the shape, not just the levels: the 30-year is still around 5.21%, its highest since 2007, which leaves 2s10s near +48bp and 2s30s near +100bp. That is a curve that steepened on the long end — the market is happily marking down near-term inflation risk on cheaper oil while refusing to give the Fed any credit further out. The dollar index (DXY — the dollar measured against a basket of six major currencies) is hovering right at 99.97, barely changed on the day after last week's slide to a seven-week low.

The dominant driver — Hormuz, and what it does to gold. This matters more than any data point today, so let me be precise about the mechanism. The closure of the Strait was a supply-side shock — a hit to the supply of a critical commodity that pushes prices and inflation up. The textbook chain runs: oil spikes → inflation stays sticky → central banks turn hawkish → real rates (interest rates after subtracting inflation) rise → the dollar gets both a safe-haven and a yield bid → gold falls despite the conflict. That is exactly the chain I've been trading, and yesterday I flipped from long gold to short gold on it. That flip is working.

Now the shock is being removed, and the chain runs in reverse — but not symmetrically. Cheaper oil pulls near-term inflation expectations down faster than it pulls nominal yields down, which nudges real rates higher even as the 10-year rallies. Add the direct drain of war premium out of the gold price and you get a bearish short-term setup. What the deal does not fix is the thing the long end is shouting about: a 30-year at 5.21% after the Fed held at 3.50–3.75% on 29 July with three dissenting votes for a hike is a market telling you it doesn't believe the inflation story regardless of what Iran does. That is a structural bid under gold that no Hormuz signature removes. So: bearish into the headline, buyer of the flush.

Gold: trading 4077.29/4077.49. Day range 4042.64–4106.32; prior-day H/L 4079.78 / 4019.10. Gold ran to 4106.32 early on Iran-strike fears, dumped $63.68 to 4042.64 as Bessent spoke, and has settled back mid-range. RSI (a momentum gauge from 0–100; above 70 is stretched, below 30 is washed out) sits at 46.26 on the 15-minute chart — dead neutral. That is a market with no conviction waiting on a headline, which is exactly the profile you fade at the edges rather than chase in the middle.

Crypto: Bitcoin 64,156.50 (RSI M15 51.66, ATR $151.93 — ATR being average true range, a simple measure of how far the thing typically travels); day 64,131–64,267, prior-day H/L 64,379 / 63,253. Bitcoin has spent the session in a roughly $1,000 box while the market digests a security exploit affecting Coldcard hardware wallets. Ether 1,872.08 (RSI M15 49.55, ATR $5.58); day 1,869.47–1,873.77, prior-day H/L 1,879.17 / 1,845.27. Total crypto market cap is about $2.28 trillion. Here is the tell I care about: equities printed all-time highs, oil collapsed, front-end yields fell — a near-perfect risk-on cocktail — and crypto did essentially nothing. An asset that won't rally on its own good news usually finds a lower price.

Key FX:

• EURUSD 1.15321 — RSI 58.43 (firm, not overbought), ATR 3.0 pips. Day H/L 1.15318 / 1.15269, prior-day H/L 1.15340 / 1.15022. Pressing the prior-day high, but that 31.8-pip prior session is one of the tightest ranges in weeks.
• GBPUSD 1.34503 — RSI 52.68, ATR 4.3 pips. Prior-day H/L 1.34563 / 1.34196. Mid-range and directionless; sterling has no domestic catalyst today.
• USDJPY 157.745 — RSI 55.74, ATR 6.3 pips. Prior-day H/L 157.959 / 157.157. This is the one to respect. Tokyo and Washington confirmed the first joint yen-buying operation since 1998 (MOF intervention — Japan's Ministry of Finance stepping into the currency market directly), with the Bank of Japan's own data implying roughly ¥5.33 trillion spent Friday after a record ¥8.45 trillion the day before. The pair round-tripped to 156.34 and has crawled all the way back above 157.70. Officials have said they "will not hesitate" to go again.
• AUDUSD 0.70456 — RSI 58.22, ATR 3.0 pips. Prior-day H/L 0.70485 / 0.69965. Firm on the risk-on tone, sitting on the prior-day high.
• NZDUSD 0.58942 — RSI 56.85, ATR 3.3 pips. Prior-day H/L 0.58964 / 0.58619. Right on the prior-day high with a clean risk-on and cheap-oil tailwind behind it.
• USDCHF 0.80914 — RSI 43.97, ATR 3.1 pips. Prior-day H/L 0.81066 / 0.80802. The weakest RSI in the majors — the franc is quietly the firmest thing in G10.

Cross-asset snapshot:

Asset	Now	vs Prior Close	Vector
S&P 500	7,737	+1.79% (record)	Risk-on
Nasdaq Comp	26,584.99	+2.59%	Risk-on
Dow	54,085.88	+1.71% (record)	Risk-on
US 2Y	4.21%	Steady	Neutral
US 10Y	4.688%	Falling (−6bp)	Dovish at the front
US 30Y	~5.21%	Elevated (2007 highs)	Hawkish at the back
DXY	99.97	~Flat	USD directionless at 100
Gold	4,077.39	−$28.93 from day high 4106.32	Bearish near term, structural bid below
Bitcoin	64,156.50	−$222 from prior-day high	Weak — no risk-on participation
Ether	1,872.08	−$7.09 from prior-day high	Weak
WTI crude	$80.34	−5.1%	Hormuz deal optimism

Normal full-liquidity session ahead, with two US data points and one unscheduled headline that outranks both.

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