To The Moon

It is coming up to 2½ months since US unilaterally decided to launch an assault on Iran with its partners-in-crime Israel.

The relative ease with which Trump’s order to capture Venezuela’s President Nicolás Maduro and his wife by force on 03 Jan 2026 has embolden the ‘foolish’ into thinking that the feat could be repeated with the same relative ease.

Trump’s history of avoiding military service (in September 1968 for the Vietnam war) suggests a fundamental detachment from the life & death stakes of the very operations he so casually orders.

What about his Defense minister ? Surely, he would know better, many had assumed.

After all, Hegseth served in the Army National Guard from 2002 to 2021 and had been deployed overseas 3 times.

On closer examination, his tours & experiences were perhaps narrow in scope:

• Guarding detainees at Guantanamo Bay in 2004–2005.

• Served as an infantry platoon leader in Iraq in 2005–2006, focus on civil-military operations.

• Served as a senior counterinsurgency instructor in Kabul, Afghanistan in 2011–2012.

By the time he retired in March 2021, he held the rank of Major, a field-grade officer role centered on tactical execution rather than grand strategy.

Because his military exposure was confined to mid-level management and localized operations, he may lacked the high-level strategic training required to grasp the global risks of attacking a foreign government.

After the blind leading the blind for a little more than 2 months, US demands placed upon Iran has softened somewhat as mediator Pakistan continued to execute its facilitator role to the best of its diplomatic ability.

Many attributed Trump’s sudden change of heart to rapid rising gas prices, so fast that it turned a geopolitical standoff into an economic problem for the everyday Americans.

Over the past 2 weeks, investors watched as (a) oil prices climb to record highs, (b) inflation fears re-awaken, and (3) concerns grow that a broader Middle East conflict could push US economy off course, mere months before the midterm elections.

In his last FOMC press conference on 29 Apr 2026, Fed chair Jerome Powell stated that US inflation remains elevated and has moved up recently, partly due to rising global energy prices following Middle East conflict, leading the Fed to maintain its interest rates.

On Wed, 06 May 2026 morning, the fickle-minded Trump’s tone changed abruptly when he announced on Truth Social that he was pausing “Project Freedom”, US operation escorting tankers through the Strait of Hormuz, for “a short period” to allow negotiations with Iran to continue.

The halt happened just one day after he launched “Project Freedom”.

The current geopolitical developments in May 2026 suggest that a "temporary" peace deal, often referred to in market circles as the Islamabad Accord or the 14-Point Memorandum, would trigger a massive rotation in global capital.

As of 07 May 2026, the primary market drivers are (a) the potential reopening of the Strait of Hormuz and (b) the lifting of energy sanctions.

If and when a formal agreement is inked, $Delta Air Lines(DAL)$ is one stock that stands to benefit enormously from it.

The potential is rooted in DAL unique structural advantages.

While all US airlines (eg. $United Airlines(UAL)$ and $American Airlines(AAL)$ included) will benefit from lower fuel prices, Delta's specific operational model makes it more sensitive to the "peace dividend" in 3 critical areas:

(1) The Refinery Advantage (Monroe Energy)

Unlike its competitors (UAL & AAL), DAL owns & operates its own oil refinery in Trainer, Pennsylvania.

Fuel Recapture:

• During the conflict, soaring crude prices squeezed the refinery's margins.

• A peace deal would lower the "crack spread" (difference between the price of crude oil and the petroleum products extracted from it).

Direct Margin Boost:

• As oil prices moderate, DAL’s refinery provides a dual benefit: (1) it lowers the direct cost of jet fuel and (2) stabilizes the "all-in" fuel price more effectively than traditional hedging.

• In Q1 2026, DAL projected a $300 million refinery benefit even when under stress; a peace deal could expand this significantly as input costs drop.

(2) Premium Revenue & Corporate Demand

DAL has the highest exposure to "Premium" and "Loyalty" revenue in the industry, that constitute approx. 62% of total revenue as of 2026:

• Premium revenue is the high-margin income from sales of upscale cabin seats, such as Delta One and First Class, rather than standard economy.

• Loyalty revenue is the stable cash flow generated through the SkyMiles program and Delta's multi-billion dollar co-branded credit card partnership with $American Express(AXP)$.

Geopolitical Tail Risk:

• High-margin business travel is the first to be curtailed during major geopolitical instability.

• A peace deal removes the "uncertainty tax" that prevents corporations from committing to long-term international travel budgets.

American Express Partnership:

• DAL’s remuneration from Amex (over $2 billion in Q1 2026 alone) is tied to consumer spending.

• A "peace rally" in the broader markets will boosts consumer confidence, directly increasing card spend and SkyMiles profitability.

(3) Transatlantic & International Dominance

DAL’s international unit revenue, particularly in the Transatlantic corridor, has been its strongest growth engine in 2026.

Route Stabilization:

• Conflict in the Middle East have forced flight path re-routing and increases insurance premiums for international carriers.

• A peace deal stabilizes these routes and reduces operational friction.

Pricing Power:

• Analysts note that DAL has maintained a "Moderate Buy" rating through the conflict because of its ability to recapture fuel costs through higher fares.

• When fuel costs drop due to peace, DAL is often slower to lower its "Premium" ticket prices than budget carriers, leading to a temporary "margin windfall" where revenue stays high while costs plummet.

Stock Price Movement - YTD.

DAL entered 2026 with strong momentum, hitting a peak near $75.35 in early February 2026.

As the US-Iran war escalated, culminating in the closure of the Strait of Hormuz on 04 Mar 2026, DAL faced extreme downward pressure.

The energy crisis pushed Brent Crude past $120 /barrel, causing DAL to shed nearly -23% of its value in a matter of weeks as the market priced in surging jet fuel costs and the "grocery supply emergency" in the GCC states.

From 27 Feb 2026 - present.

On Fri, 27 Feb 2026, DAL closed off the week at $65.70 /share.

The following week as military tensions intensified, the stock plummeted to a YTD low of $57.94 by 12 Mar 2026. (see above)

The decline was driven by "Operation Epic Fury" and the total suspension of Qatari LNG, that threatened global industrial output.

Volatile Sideways Grind:

• Throughout April 2026, DAL traded between $65 and $71.

• While demand for premium travel remained resilient, the ongoing blockade and $100+ oil prices acted as a firm ceiling on the stock’s recovery.

The "Peace Hope" Rally (May 4 – May 6):

In the days leading up to 6 May 2026, rumors of a Pakistani-mediated "Islamabad Accord" began to leak.

On 6 May 6 2026, DAL surged +3.5% to $73.49 following reports that the US and Iran were nearing a one-page memorandum to end hostilities.

This "peace-deal trigger" was fueled by oil prices falling -8%, directly promising a massive relief in DAL's operating expenses.

On 07 May 2026 even before a peace-deal is signed, both countries are trading smaller scale attacks at each other, threatening to derail the fragile peace treaty.

Many speculated that it was Trump’s doing to "pressure" finalization of the deal.

Ironically, the stock has maintained a recovery trajectory toward $75 while closing marginally lower at $73.11 by the time trading ended on Thu, 07 May 2026.

Time To Buy ?

I defer to DAL’s technical indicators of (a) Simple moving averages, (b) MACD and (c) 14-day RSI to help with the determination. (see below)

Simple Moving Averages (SMA)

The chart displays a bullish alignment of the three moving averages, often referred to as a "stacked" formation.

DAL’s Thursday closing price of $73.11 is above the SMA of 20-day ($69.57), 50-day ($66.36) and 200-day ($63.73).

The upward slope of all 3 SMAs suggests sustained buying pressure across short, medium, and long-term horizons, with the 200-day SMA acting as a solid floor for the long-term primary trend.

The stock had a “golden cross” formation in late Aug/ early Sep 2025, accounting for the gradual rise in stock price.

MACD.

MACD indicator reflects positive momentum, though it shows signs of a potential short-term cooling period.

The MACD line (1.13) lies above the Signal line (0.79), with both above the Zero line, indicating bullish moment.

A positive divergence of $0.34$.and a green bar histogram indicates that bullish momentum is still in control, though the peaks are lower than the high seen in early 2026, suggesting the pace of the ascent is moderating slightly.

RSI.

With 14-day RSI coming in at 63.36, DAL is a moderately bullish sentiment, showing strong positive momentum without being severely overbought.

There is room to float higher before hitting the 70 overbought benchmark.

The stars for DAL are aligned, what is missing now is the peace deal to be signed between US & Iran.

On the run up to that, taking a stab at DAL now seems logical with Summer travel just round the corner. Agree ?

Remember to check out my other posts. (See below). Help to Repost ok, Thanks.

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• Do you think a peace deal is closed to happening soon ?

• Do you think DAL will rally to a new high, once the peace treaty is signed ?

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