Good morning! A day later and we are still waiting for... well, anything. We still get only bits and scraps while the ceasefire deadline is approaching. Traders are also waiting for the news after initial bullishness in the week, as most markets normalized at previous levels.

But some of them had interesting moves.

Iran Tracker

#1 Peace

In a flurry of conflicting news traders see a path towards peace. Since yesterday, peace chances grew to 60% by end of May.

The perception shift was sustained even amid growing military buildup in the region. Considering top holders in this markets, it is a strong signal that peace is on the table and things can move fast. Similar story is visible on the end of ceasefire market, indicating that resumption of hostilities is unlikely:

That being said, the market can react sharply if we don't get any bullish news soon.

#2 The Strait Of Hormuz

The Strait of Hormuz continues to be effectively closed. And here traders continue to be bearish on the normalization of traffic.

Even a peace deal would not resume traffic immediately. Vessels wouldn't be so eager to sail into the Persian Gulf and considering a possibility of a toll, there might be a queue to get out.

Single day transit forecast is stable:

Energy prices are also flat since yesterday:

#3 Boots On The Ground

Chances of US invasion remain at 33%, sustained mainly by the continued airlift to the region.

Be it pressure tactic, internal conflict or the ceasefire being just a disguise for renewed action, this is the one thing that keeps the situation ambiguous. And in case of invasion, we now cannot say what would be the target as Kharg Island chances dropped to only 10%:

#4 Regional Expansion

Regional expansion chances continue to dive as there is no indication Gulf countries will be needed in case of resumption.

There are so many US assets in the region at this point that the expectation is that it will be a joint US-Israeli action, rather than a broader effort.

On the other side of the Arabian peninsula, chances of the Bab-el-Mandeb Strait closure also decreased, reaching previous lows:

If anything, recent price action on the above markets screams end of conflict.

#5 Iran Regime Fall

Iran regime fall chances also reached new lows, confirming the above statement.

In case of ground invasion, these should spike up significantly. Them reaching their low now is a strong indication the end is near.

Wrap up

We see a lot of hope in the markets, but this time it is sustained by bullish developments on the ground. Still a lot can happen, but there is a path to peace. Price action since yesterday continues to suggest that.

We will continue to monitor the situation as the next hours and days will be crucial.

Make sure to follow prediction markets live to get fresh information on the conflict. Stay strong and see you tomorrow for another Morning Brief!

This is not official investment or life advice. Do your own research. This are only my opinions and I encourage anyone to do their own research before putting any money anywhere.