Quantitative models are now being applied to the popular "Trump Always Caves On" (TACO) trade on Wall Street. An institution has selected four key indicators for calculation, suggesting the policy shift window falls around the end of July. Allies among Republican conservatives warn that if oil prices stabilize above $90, the ruling party could lose the midterm elections.

The phrase "Trump Always Caves On" (TACO) has become a common framework for observers to predict the US President's next moves. In the face of escalating conflict with Iran, a geopolitical consulting firm is attempting to use financial market data to build a model forecasting when Trump might adjust his strategy.

The team at Signum Global Advisors, led by analyst Andrew Bishop, selected four core indicators: Brent crude oil prices, the yield on the US 10-year Treasury, vessel traffic through the Strait of Hormuz, and the S&P 500 index. Their calculations incorporate Trump's historical sensitivity to market fluctuations.

The model indicates that Trump typically requires a market shock of approximately 2.3 to 3.4 standard deviations, averaging around 2.9, to prompt a policy shift. Based on the current market environment, analysts believe the moment for a TACO is not yet here, but it is getting closer.

They stated, "Based on linear extrapolation, TACO could occur as early as July 22nd, and should happen no later than July 30th (barring a significant improvement in the situation, which seems unlikely) – historical data points to July 26th as the most probable date."

Currently, the US-Iran conflict is entering a more difficult phase. As the US continues to expand military operations and Iran intensifies its counterattacks, shipping through the Strait of Hormuz is being disrupted, driving international oil prices higher. Brent crude has surpassed $91 per barrel, and the US average gasoline price has risen above $4 per gallon for the first time since mid-June.

Casualties from the conflict are adding to domestic pressure in the US. US Central Command has announced a new round of military actions aimed at degrading Iran's ability to attack commercial vessels and disrupt energy transport. Simultaneously, the US has confirmed that several American military personnel have been killed in related attacks.

Some US political figures are concerned that a prolonged war could become a political liability for the Trump administration. Within the Republican Party, there is also focus on the impact of rising energy prices on the cost of living for citizens and the electoral environment.

"This is precisely the sign of getting bogged down in a long-term conflict," a source close to the White House indicated, suggesting the war is consuming the political capital the government had hoped to use for its economic agenda.

However, other perspectives suggest Trump's current hardline stance may be more about forcing Iran back to the negotiating table. Previously, multiple mediators have presented Iran with new de-escalation proposals, including short-term ceasefire arrangements, to revive previously stalled diplomatic processes.

The US government, for its part, emphasizes that the goal of military action is not to escalate the conflict but to compel Iran to cease threatening shipping security. White House spokesperson Taylor Rogers stated that energy prices are expected to decline as US forces degrade Iran's relevant capabilities.

Analysts point out, however, that the longer the conflict persists, the more limited Trump's options become. On one hand, further escalation could bring higher economic and political costs; on the other, reducing military pressure could be perceived as conceding to Iran.

Currently, the US retains various military options, including expanding maritime operations and striking more infrastructure, but there are divisions within the administration over whether to escalate further.

Last month, Trump acknowledged he was unsure if Americans had the "stomach" for a longer, broader war. Some of his supporters believe Iran is trying to wear down US patience through attrition, but they argue Trump will not easily accept defeat.

Concurrently, warnings are emerging that sustained high oil prices and war casualties could erode the ruling party's political advantage.

"My rule of thumb is if the ruling party has oil above $90 a barrel, they lose; if it's below $70, they win. I think we're in the danger zone now," said Curt Mills, Executive Director of a US conservative magazine closely linked to the Republican conservative camp.

US defense budgets and war spending are also sparking domestic debate. The government previously proposed a large-scale defense budget and requested additional funds for conflict-related expenditures, but these plans have faced resistance in Congress.