Stock futures are slipping as WTI crude oil jumps back above $100 after Trump ordered a blockade of the Strait of Hormuz. The move looks relatively contained given the breakdown in US-Iranian talks over the weekend.

Equity futures tied to the Dow, S&P 500, and Nasdaq all dropped more than 1% but are paring some losses. The market will also focus on Q1 earnings season kicking off with big banks reporting this week, watching for margin pressure from the energy spike, hiring commentary, and forward guidance in a high inflationary environment.

The breakdown in talks intensified concerns of a worsening global energy crisis. The effective shutdown of the Strait drove energy prices sharply higher, reinforcing expectations that central banks may delay any interest rate cut.

Gold dropped below $4700 an ounce, dipping to $4626 before recovering to $4741. Key support for gold is 4600-4575, with upside edge at 4860-4900. A break above 5050 could see trend-following funds return. For silver, key support is 7250; a breakdown could push futures back to $70.78 and then $68.24.

May crude oil futures are up about 8%, sitting at $104.21. My thesis is if this is a prolonged event, the December crude contract will start to catch up to the May contract and hold elevated for longer.

Many clients entered around the $70 level. The December contract high was $77.78. The 20-day exponential average range is about $8.80.

Fed interest rate expectations show a 96% chance of unchanged rates in April and June, and a 90% chance in September. They really don't know what's going on out there.

The dollar index is edging higher by 0.3% to 98.735. Bitcoin is selling off, down 3.5% to $70,915, and needs to get over $74-75 to change the trend.

You really want to watch the 10-year Treasury yield, the dollar index, and crude oil. If you have those three things up, along with the volatility index, you can see how these markets will unfold with higher energy prices.

If oil prices start to back off and fill the gap, you could see a relief rally in equity markets. If oil pushes higher on any escalation, things could become unhinged again and markets could have big movements.