Lack of Conviction in Institutions' Bitcoin Positioning; CPI and Iran Talks May Provide Clarity

Although bitcoin's price has surged nearly 7% since Sunday, the recovery has stalled near $72,000 due to key binary risks, including the upcoming US inflation report and US-Iran truce talks. Institutions are adopting a cautious approach, evident in the options market where they are purchasing calls while also seeking downside protection through puts. According to QCP Capital, options for BlackRock's spot bitcoin ETF show demand for the $45 call expiring in May, indicating traders expect the price to rise above this level. Similarly, bitcoin options on Deribit have seen significant demand for the $80,000 call. However, the persistent demand for puts, which offer protection against declines, is also notable. The US consumer price index for March is expected to show a significant increase in annualized inflation, primarily driven by rising energy prices. This may lead to market volatility, particularly if the core figure exceeds the estimated 2.7% annualized rate. The upcoming meeting between Iranian and US delegates in Pakistan is also crucial for financial market stability, as a potential end to the war could accelerate bitcoin's rally. The first signs of this could be seen in Hyperliquid-listed oil perpetual futures.