The VIX, the fear and selling indicator in the US market, reached 25.

In such circumstances, the market sometimes rebounds and rises against expectations.

At the start of the war, many people sold out of fear, but the market "betrayed" them and rose instead of falling as they had anticipated. Why? Because smart money, institutions, and large funds had already priced in the war's impact.

The pricing was based on Bitcoin dropping from 85,000 to 59,000 as troop buildups began in the Middle East. At the time, many were surprised by the seemingly inexplicable drop.

Even a few days before the war began, the last price reading showed a drop from 70,000 to 62,000.

However, caution is advised: if the war drags on and there is no ceasefire or truce in the coming days, the market will start pricing in other risks, such as supply chain disruptions in the Strait of Hormuz and rising energy prices, leading to increased inflation. It's clear now that the market is pricing in a short war, similar to last year's 12-day war.

Therefore:

– The 62,000 level is a significant support level, and breaking it would likely lead to renewed bearish pricing.

– Breaking through 70,000 and closing above it for at least a full trading day would signal that the market is pricing in the end of the war.

And God knows best.

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