Sifting through the Garbage
Dick Lo5 min read·Just now--
09-April-2026
- The inherent fragility of the ceasefire was laid bare only moments after it took effect as reports surfaced of widespread violations from both sides. Israel launched heavy strikes across Lebanon and targeted an Iranian oil refinery on Lavan Island, while a barrage of missile and drone attacks from Ian was reported across multiple Gulf nations
- Iranian Parliament Speaker Ghalibaf, who is expected to be a prominent figure in the impending negotiations, asserted that three critical clauses of Tehran’s 10-point proposal had been breached before formal negotiations could even commence. However, both President Trump and Vice President Vance have explicitly denied that Lebanon was ever included in the scope of the ceasefire
- In yesterday’s brief (TACO Tuesday), we noted that any acceptance of the publicised 10-point proposal would likely be framed by critics as a strategic concession. President Trump has since responded forcefully to such characterisations, with Press Secretary Karoline Leavitt stating that the President threw Iran’s original 10-point plan “in the garbage”. Trump further asserted that an alternative, unpublished framework is forming the true basis of negotiations, one which he described as “reasonable”
- The precarious nature of the ceasefire triggered an immediate rebound in oil prices from their intraday lows. Meanwhile, a report from the Financial Times suggests that Iran is demanding Bitcoin as the settlement medium for passage through the Strait of Hormuz, a move that underscores the sovereign utility of digital assets, however controversial the use case. At a proposed $2 million per vessel and a pre-conflict traffic volume of approximately 100 to 150 vessels per day, this regime could theoretically generate upwards of $300 million in daily Bitcoin demand
- The minutes from the March FOMC meeting revealed a committee concerned that a prolonged conflict in the Middle East could fuel higher energy prices, warning that higher input costs would likely pass through to core inflation. However, while “many” participants signalled that the risk of elevated inflation could necessitate rate increases, “most” raised the counter-concern that a protracted conflict could further soften labour markets, potentially warranting additional rate cuts. In FedSpeak, “most” outnumbers “many”, implying that the Committee is structurally biased toward supporting growth should the energy shock morph into a growth shock
- On the macro front, focus is on tonight’s release of the U.S. February Core PCE report. Market consensus expects an unrounded print of +0.39% MoM, with the year-over-year figure holding at +3.0%. On a rounded basis, this would mark the third consecutive monthly increase of +0.4%, a persistent level of heat that complicates the Fed’s disinflation narrative. Crucially, this data set pre-dates the current Middle East escalation. Therefore, should the unrounded figure exceed expectations, there is significant risk of a negative market reaction as investors re-price the inflation floor even before accounting for the recent surge in energy costs
- A White House Council of Economic Advisers (CEA) report has concluded that a prohibition on stablecoin yields would result in a negligible 0.02% increase in bank lending while imposing an estimated $800 million cost on consumers. While digital asset proponents were quick to leverage these findings as proof that yield-bearing stablecoins pose no existential threat to community banks, the banking lobby remains unconvinced and argues that the report fails to account for the potential for deposit flight from community banks. Amidst this friction, Treasury Secretary Scott Bessent took to the Wall Street Journal editorial page to again urge immediate legislative action on the Clarity Act, framing it as a matter of urgent national priority
- Morgan Stanley’s spot Bitcoin ETF (MSBT) delivered a robust debut, with day-one volume exceeding $33 million, placing it in the top 1% of historical ETF launches. We anticipate inflows will accelerate as the firm’s network of 16,000 financial advisors begin actively pitching wealth management clients to initiate Bitcoin allocations. Meanwhile, Strategy’s perpetual preferred STRC series traded over $300 million in volume within a tight range of $99.99 to $100.01, signalling another aggressive day of ATM issuance for further Bitcoin treasury acquisitions
Trading Roadmap
- Persistent confusion regarding the ceasefire’s scope, coupled with a lack of consensus on the definitive 10-point framework, will likely fuel sustained uncertainty and price volatility. Furthermore, the strategic incentives for Israel and various Gulf nations to prolong the conflict heightens the risk of deliberate violations, which could trigger a renewed cycle of escalation
- Reflecting our tactical update from yesterday, we have utilised the overnight move above $72k to further monetise shorter-dated risk reversals. At the same time, we continue to accumulate May-expiry wings on high-beta altcoins, capitalising on depressed implied volatility levels to position for an expansion in two-way volatility
- Should a hot PCE print coincide with further ceasefire breaches to spark a deeper pullback, we are focusing on the following June structure, with a plan to scale into this positions on dips toward or below the $69k level, maintaining our thesis on potential legislative tailwinds of the Clarity Act:
Long 26-June-2026 $82k/$90k Call Spread versus Short $50k Put (upside capture with a funded premium, targeting a potential maximum payout of 12x+ the net premium paid)
Please contact the desk for bespoke structuring and live pricing
Disclaimer
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