In the early hours of Wednesday, the entire planet was waiting to see whether the war would escalate and blow everything apart.
Trump had set a deadline. And not just any deadline… he even wrote that if no agreement was reached, “a whole civilization will die tonight.”
Yes. That extreme.
And just when most people were expecting the worst… the ultimate plot twist came.
A two-week ceasefire.
Let me break it down quickly so it all makes sense.
We’re dealing with a war that’s been going on for more than five weeks, between the US and Iran, with Israel also involved. At the center of it all are the Strait of Hormuz. As I’ve mentioned before, about 20% of the world’s oil passes through there. Which means that if they shut down… we have a global problem.
So Trump set a very clear deadline. Either the straits open, or attacks on civilian infrastructure begin.
And just hours before the deadline expired, he raised the tension even more, triggering global panic.
Then came the twist.
Less than two hours before the deadline, he announced a two-week pause on attacks, under one key condition: Iran must immediately and safely reopen the Strait of Hormuz.
This deal didn’t come out of nowhere. There was intense pressure, mainly from Pakistan, to give diplomacy a chance. During these two weeks, the US and Iran will sit at the negotiating table, based on a 10-point proposal submitted by Tehran.
This includes things like lifting sanctions, withdrawing US forces from the region, releasing Iranian funds, and of course the major issue of the nuclear program.
And here’s where it gets interesting.
Both sides are presenting the deal as a win.
Trump claims they’ve already achieved their military objectives and are close to a final agreement. On the other hand, Iran says the US essentially backed down to the will of the Iranian people.
Classic.
But the real question is what’s happening in practice.
Because just hours after the ceasefire announcement, things started to spiral again.
Israel launched massive strikes in Lebanon, hitting over 100 targets within minutes, with hundreds of casualties. Iran responded by saying the agreement had already been violated. At the same time, we’re seeing continued missile activity and accusations of airspace violations.
In other words, what we have right now is not peace.
It’s a temporary pause.
And the most critical part of this entire situation remains the Strait of Hormuz.
In theory, it’s open.
In practice, it’s chaos.
Ship traffic is still extremely limited, shipping companies don’t have a clear picture of what’s actually happening, and no one truly feels safe passing through.
And that’s because Iran is saying something very simple but very important:
“Yes, you can pass… but under our control.”
That means every ship needs approval, inspection, and even payment of a kind of toll. We’re talking about roughly $1 per barrel of oil, with Iran even mentioning payments in crypto like Bitcoin.
And if you consider how many ships pass through there… that’s a lot of money.
The most extreme part?
There have been warnings that any ship trying to pass without permission… could be destroyed.
So the core problem hasn’t been solved.
It’s just been shifted.
And this is where analysts bring things back to reality.
The main issue is very simple: there is no trust.
The US doesn’t trust Iran’s nuclear program, and Iran doesn’t trust the US because of past agreements that weren’t honored. Even the situation with the strait remains unclear, since Iran hasn’t defined exactly how this agreement will be enforced.
That’s why many analysts are saying this isn’t a solution.
It’s just a pause before a potential new escalation.
Some even believe renewed conflict is very likely, very soon.
Now here’s the most interesting part for me.
What did the markets do?
They celebrated.
Oil dropped as much as 16%, stocks rallied hard, and we saw a classic relief rally. But what’s even more interesting is that the markets seemed to expect this outcome.
And this is where a concept that’s been gaining traction comes in: the “TACO trade” — Trump Always Chickens Out.
The idea is simple.
Trump starts with extreme threats, pushes tensions to the maximum… but in the end, he backs down and settles for some form of compromise.
And investors have started to exploit this pattern.
They buy when the market drops, because they expect a deal and a rebound.
The more extreme the threat… the more likely they believe de-escalation will follow.
But this is also dangerous.
Because if markets stop reacting to these situations, we might lose a key “control mechanism”… and that could lead to even greater escalation in the future.
