Iran launched missile attacks on Kuwait, leading the UAE to consider joining a US-led mission to secure the Strait of Hormuz. Odds for a US-Iran ceasefire by April 7 are at 1% YES, while US forces entering Iran by April 30 are at 86% YES.
Traders are bearish on a near-term ceasefire, with April 7 odds dropping from 12% last week to 1% now. The April 15 market shows a similar decline, down to 6% YES. April 30 stands at 18%, indicating traders see little chance of a ceasefire amid rising tensions.
Conversely, the odds of US forces entering Iran by the end of April have surged to 86% YES, up from 58% a week ago. The UAE’s involvement in securing the Strait of Hormuz suggests impending military actions, contributing to the increase. The market for troops entering Iran by December 31 also rose to 90% YES.
USDC traded in the ceasefire markets totals $430,773 in the last 24 hours, with $12,367 needed to move the April 7 price 5 percentage points. For the US forces market, trading volume is higher at $5,069,224, with $85,204 needed to move the April 30 odds by the same margin. This indicates strong trader conviction about military escalation.
Iran’s aggressive actions and the UAE’s alignment with the US reduce the likelihood of diplomatic resolutions. A YES share in the April 7 ceasefire market pays $1 if it resolves, but at 1¢, the market sees little chance of this outcome.
Watch for CENTCOM statements and UAE military movements. Changes in operational language or troop deployments could impact these markets.
Markets Impacted
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