Lack of Conviction in Institutional Bitcoin Positions

Bitcoin's price has seen a 7% increase since Sunday, but its recovery has stalled near $72,000 due to key risks, including the upcoming US inflation report and US-Iran talks. Institutions are taking a cautious approach, buying call options to bet on price gains while also purchasing downside protection. According to QCP Capital, there is demand for the $45 call expiring in May for BlackRock's spot bitcoin ETF, indicating expectations of a price rise above $40. However, the demand for puts, which provide protection against declines, persists, as seen in the options skew, which remains negative across all time frames. The US consumer price index for March is expected to show a significant increase in annualized inflation, led by rising energy prices, which could lead to market volatility. The meeting between Iranian and US delegates in Pakistan may also impact financial market stability, with a potential end to the war and normalization of oil tanker traffic through the Strait of Hormuz likely to accelerate bitcoin's rally. The ICE BofA US Bond Market Option Volatility Estimate Index, which reflects volatility in US Treasury futures, has shown a decrease in turbulence, indicating a positive signal for crypto bulls.