Iran’s threat of retaliation and ongoing strikes on Gulf infrastructure have slashed the odds of a US-Iran ceasefire by April 7 to 1.1% YES. This is a drop from 2% just a day ago and a sharp decline from 12% a week ago.
The April 7 ceasefire market is stagnant, with odds at 1% as military actions persist. The April 15 market shows a slight chance at 6.5% YES, indicating ongoing pessimism. Traders are focusing on later dates, with notable activity in the April 30 market at 17.5% YES, and May 31 at 36.5% YES. The significant jump between April 30 and May 31 suggests expectations for a catalyst during that period.
The April 7 market sees $22,948 in USDC traded daily, but just $12,367 can shift the price by 5 points, indicating a thin market. In contrast, the April 30 market is more robust with $196,968 traded daily, showing stronger trader conviction.
Military actions and failed ceasefire talks suggest no quick resolution. The market doesn’t expect an imminent breakthrough, especially with Trump’s deadline for reopening the Strait of Hormuz approaching without progress. A YES share in the April 7 market pays $1 if resolved, but at 1¢, expectations are near zero. For change, traders need to see diplomatic progress, like intermediary activity from Oman or Qatar, or softened rhetoric from either side.
Watch for statements from CENTCOM or unexpected diplomatic moves. Trump’s actions and intermediary activity, particularly involving Oman or Qatar, could dramatically shift market perceptions.
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