01.04.2026 - Rally - just a calendar event

Yesterday in the US, followed by Asia and Europe this morning, markets staged a notable relief rally. The move appeared broad-based and aggressive — but the underlying drivers suggest something very different from a genuine shift in trend.

On the geopolitical front, rhetoric remains highly unstable. Donald Trump signaled openness to ending the war within weeks, even if the Strait of Hormuz remains disrupted. At the same time, Iran continues to escalate: threats of direct attacks on US interests and a parliamentary move to impose tolls on ships transiting the Strait underline that tensions are far from resolved.

Markets: strong relief rally

• Equities: see a strong day with Tech stocks in the lead, up more than 3%

• Bonds: yields lower - US 10-year Treasury yield at 4.31%

• Commodities: oil prices stable after a short dip - WTI crude oil USD 100/barrel and Brent towards USD 104/barrel. Precious metals gain - silver at USD 74/oz and gold above USD 4’720/oz

• Currencies: USD falls

• Cryptos: small gains - Bitcoin USD 68k

• Volatility: The VIX declined sharply, falling to 25 from above 30.
  

My View: Most market participants attribute the rally to political headlines suggesting a potential end to the conflict. That interpretation is too simplistic, and likely wrong.

This move has all the characteristics of a technical rally, not a fundamental one.

We are at month-end and quarter-end, following a period of negative performance. This matters.

• Institutional portfolios, pension funds drifted away from target allocations due to falling equity and bond markets

• Rebalancing flows forced large-scale equity and bond buying

• CTAs were persistent sellers throughout the month — one of the longest stretches — and are now reducing pressure

• Short sellers, sitting on profits, were pushed to cover positions

This combination creates powerful upward moves, but they are flow-driven, not conviction-driven

There is no real change in the macro or geopolitical backdrop. This is not de-escalation. It is noise within an ongoing crisis. The core issue remains untouched: the situation around the Strait of Hormuz.

As long as this critical artery for global energy supply remains at risk, or partially impaired, the market is structurally exposed. Oil prices reflect this reality far more accurately than equities currently do.

That divergence is unlikely to persist.

Positioning takeaway:

• No panic

• No FOMO

• Do not chase this rally

These types of rallies are the most dangerous. They create the illusion that the worst is over - it isn’t.

The risk remains that markets will need to reprice again, potentially more aggressively, once the temporary support from calendar effects fades.

A disciplined approach remains key.

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