Oil prices surge 3% on US-Israel strikes, with WTI targeting $70 resistance amid Strait of Hormuz disruption fears.
Gold rallies toward $5,300/oz as safe-haven demand intensifies, breaking above the critical $5,200 threshold.
Global equity markets face risk-off pressure as the VIX volatility index spikes on escalation concerns.
Market Overview
WTI crude oil faces immediate resistance at $67-68, with a psychological barrier at $70; a breakout could target the $90-120 range.
Gold maintains bullish momentum with a neutral-to-bullish RSI, where the $5,200 level aligns with the 200-week MA and 61.8% Fibonacci retracement.
Brent crude could reach $80-140/bbl depending on the conflict scope and potential supply chain disruptions.
Oil options markets are pricing in 15-30% crude increases within 48 hours of major military escalation.
Core Driving Factors
US and Israel launched "Operation Epic Fury" on February 28, 2026, targeting Iranian nuclear and military facilities in joint combat operations .
President Trump announced major strikes to prevent Iran from obtaining nuclear weapons, with explosions reported in Tehran and multiple Iranian cities.
Iran retaliated with missile strikes toward Israel and US military bases, raising the risk of a wider regional conflict.
Strait of Hormuz disruption concerns are driving an oil premium, as 20-21% of global oil supply passes through this critical chokepoint.
OPEC+ ministers are scheduled to review production policy amid supply uncertainty, with geopolitical risk at peak levels.
Trading Strategy
Gold could surge 15% to $5,500-5,800/oz in the short term, with extreme scenarios targeting $6,500-6,750 if real rates fall.
Traders should anticipate rapid initial spikes followed by a reassessment phase, making risk management crucial given conflict uncertainty.
Safe-haven currencies like JPY and CHF are likely to strengthen against risk assets, suggesting a reduction in equity exposure.
Entry points for oil longs should account for volatility, while gold pullbacks offer portfolio protection opportunities.
Risk Warning
Geopolitical escalation could trigger a 10-15% equity market correction if the conflict expands beyond its current scope.
Oil supply disruptions through the Strait of Hormuz could push prices to $140/bbl, creating global inflationary pressures.
Safe-haven demand is extremely volatile; gold gains may reverse if the conflict stabilizes or de-escalates quickly.
High-leverage positions in oil futures face liquidation risk amid extreme volatility; reduce leverage to 3x or below.
