The ongoing conflict between the United States and Iran has been causing significant concern for global markets. However, despite the growing tension, the price action in the market is following a familiar pattern that has been seen in US equities during previous geopolitical shocks. While it may be tempting to assume that this time will be different, historical data suggests that markets may be nearing a point of bottoming out.

One key indicator to watch is the VIX index, which measures the expected volatility of the S&P 500. As seen in the graph below, the VIX has been increasing steadily since the start of the year, but it has yet to reach levels that are historically associated with a market bottom.

Another important factor to consider is the performance of the US dollar. During times of geopolitical uncertainty, investors often flock to safe-haven assets such as the greenback. As seen in the graph below, the US dollar has been strengthening against other major currencies, which could be a sign that investors are preparing for a potential downturn.

While these indicators may suggest that markets are nearing a point of bottoming out, it is important to remember that geopolitical tensions can have unpredictable effects on the market. The conflict between the US and Iran is complex and multifaceted, and there are many factors at play that could impact the outcome.