Despite a 7% price surge since Sunday, bitcoin's recovery has stalled near $72,000, with conviction remaining weak ahead of key events such as the US inflation report and US-Iran talks. Institutions are adopting a cautious approach, buying call options to speculate on price gains while also purchasing puts for downside protection.
Demand for $80,000 call options has increased, but the options skew remains negative, indicating a persistent bias towards put options. The upcoming US consumer price index is expected to show a significant increase in annualized inflation, potentially leading to market volatility.
Meanwhile, the outcome of the US-Iran talks may impact financial market stability and bitcoin's price. The ICE BofA US Bond Market Option Volatility Estimate Index has dropped to 74% after a sharp spike in March, signaling calmness in the bond market and a positive signal for crypto bulls.