Lack of Conviction in Institutions' Bitcoin Positioning

The price of bitcoin has surged nearly 7% since Sunday, but its 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 buying calls while also seeking downside protection. According to QCP Capital, there is demand for the $45 call expiring in May for BlackRock's spot bitcoin ETF, indicating an expected price rise above the current $40 level. Similarly, bitcoin options on Deribit show a popular bet on the $80,000 call, yet demand for puts persists. The US consumer price index for March is expected to show a significant increase in annualized inflation, primarily driven by rising energy prices. The meeting between Iranian and US delegates in Pakistan may 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 uncertainty around inflation and interest rates, indicating a calm bond market and a positive signal for crypto bulls.