Three forces whipsaw Wall Street and Bitcoin as oil surges

Wall Street recorded its third consecutive losing session Tuesday. The Dow fell 419 points. The Nasdaq dropped 1%. The 10-year Treasury yield climbed to 4.79%. Renewed U.S. strikes near the Strait of Hormuz pushed Brent crude up 4.6% to $95.70 a barrel Tuesday evening. U.S. crude closed above $90 for the first time in over a month. Jim Cramer identified Iran, the Federal Reserve and the president as three sources of market volatility. Cramer said Iran's latest threat involving the Strait of Hormuz resurfaces when ceasefire hopes fade. Federal Reserve Chair Kevin Warsh has signaled that he would raise rates even at the cost of a recession. Cramer compared Warsh with former Fed Chair Paul Volcker. Traders put the odds of a September rate hike at 66%, up from about 40% a week earlier. Cramer estimated that a provocative presidential post about Iran shaves about a quarter point off major indexes. He estimated that an actual strike can cut markets by half a percent and add two percentage points to oil. Cramer called this a volatility premium with no fixed expiration. Cramer's team trimmed data center exposure ahead of the November election because of political risk to AI names. The team kept core holdings in Nvidia and Apple. Bitcoin briefly fell below $77,000 during Tuesday's broader risk-off move. Investors trimmed exposure across stocks and crypto. Ether also fell as traders reduced risk across the sector. Cramer's investing club raised cash to more than 15%, its highest level in 25 years. Cramer expects the whipsaw to continue until Iran's conflict eases or the Federal Reserve's path becomes clearer. The August jobs report on Friday could further reshape rate-hike expectations.