Market Commentary

U.S.-IRAN CONFLICT — THE APRIL 6 DEADLINE APPROACHES WITHOUT AGREEMENT

The week began with moderately optimistic signals: on Monday, Trump indicated the war would "likely end soon" and oil pulled back. However, on Thursday Trump delivered a televised address warning of 2–3 more weeks of operations. The Strait of Hormuz remains effectively restricted — reports indicate the IRGCN has intercepted commercial vessels attempting transit. Iran and Oman announced a joint protocol to "monitor" Strait traffic on Wednesday, but this falls short of reopening. Trump was direct: "if they make the right deal, the strait will open." The extended deadline for operations against Iranian energy infrastructure expires Monday April 6 at 8:00 PM ET — the most immediately relevant milestone for global markets.

ENERGY AND COMMODITIES — HISTORIC OIL SHOCK

Oil experienced extreme volatility during the week. WTI surged 11.4% on Thursday alone to ~USD 111.54/bbl, with an intraday range of USD 97.56–113.93. Dated Brent (physical spot price) reached USD 141.37 on Wednesday — a high since 2008 — with the spot-to-futures spread widening to USD 32.33, reflecting acute physical tightness. WTI traded at a rare premium to Brent futures, reflecting the direct U.S. war-risk premium. U.S. crude inventories (EIA) rose 5.5 million barrels to 461.6 million, providing some supply cushion. Gold reached ~USD 4,826/oz during the week before pulling back to ~USD 4,675 on Friday on de-escalation signals.

EQUITIES — FIRST POSITIVE WEEK SINCE THE CONFLICT BEGAN

Despite the adverse backdrop, equity indices closed the shortened week in positive territory — the first time since the Iran war began. The S&P 500 closed Thursday at 6,582.69 (+3.4% weekly), the Nasdaq at 21,879.18 (+4.4%), and the Dow at 46,504.67 (~+3.0%). The Tuesday–Wednesday rally offset Monday weakness and Thursday volatility. The 10-year Treasury yield closed at 4.31%.

POWELL AT HARVARD AND EMPLOYMENT DATA

Powell spoke at Harvard on Monday, signaling the Fed remains in "wait and see" mode regarding the Iran conflict's economic impact. He indicated the Fed will attempt to "look through" the energy shock if it proves temporary, while monitoring inflation expectations "very, very carefully." He also warned that the USD 39 trillion debt trajectory is "not sustainable." February JOLTS (released Tuesday) showed a decline of 358,000 openings to 6.882 million, below consensus. Jobless claims fell to 202,000. The March employment report (+178,000) was released Friday with markets closed.

TARIFFS — "LIBERATION DAY" ANNIVERSARY

On Thursday, the one-year anniversary of the original "Liberation Day," Trump signed two significant tariff actions: (1) a headline 100% tariff on patented imported drugs and active ingredients, with broad carveouts for companies with pricing and onshoring agreements; and (2) a restructuring of steel, aluminum, and copper tariffs, maintaining the 50% rate but now applied to the U.S. buyer's price.

Bitcoin (BTC)

BTC trades around USD 66,900, with a relatively contained weekly range between ~USD 66,200 and ~USD 69,000. The asset remained range-bound within the USD 65,000–75,000 consolidation band that has defined its behavior since February. March closed as BTC's first positive month since September 2025 (+1.8%), breaking a five-month losing streak. BTC enters the Easter weekend as one of the few liquid assets available to digest the employment surprise (+178,000 vs. +59,000 estimate), with ETFs and CME closed. Support at USD 65,000–66,000 remains the key level; resistance at USD 70,000–71,200.

Ethereum (ETH)

ETH trades around USD 2,050, showing recovery from the prior week. The weekly range oscillated between ~USD 2,000 and ~USD 2,139. However, the Drift Protocol exploit on Solana (detailed below) generated an unexpected collateral effect: the attacker converted ~980,000 stolen SOL to USDC and then to ~130,000 ETH (~USD 267MM), which provided temporary price support for ETH. On-chain metrics signal an incipient supply crunch in ETH, with exchange balances at lows.

Solana (SOL)

SOL trades around USD 80.50, registering the largest weekly decline among the three assets. The Drift Protocol exploit — Solana's largest decentralized perpetual futures protocol — for ~USD 286MM represented the biggest DeFi hack of 2026. The DRIFT token fell ~25% and protocol TVL collapsed from ~USD 550MM to under USD 250MM. On-chain intelligence firms (TRM Labs, Elliptic, Arkham) attribute the attack to North Korean (DPRK)-linked hackers. SOL has posted six consecutive losing months and trades ~73% below its June 2025 ATH of USD 294. Support at USD 77–80; risk of extension toward USD 68 if risk-off persists.

LEVERAGE LEVEL: ELEVATED — LIQUIDATIONS >USD 350MM ON THURSDAY

On Thursday April 2, Trump's televised address on Iran triggered liquidations exceeding USD 350MM across Digital Assets in 24 hours, with ~USD 235MM in longs and ~USD 169MM in shorts. Ethereum led liquidation volumes (~USD 90–105MM), surpassing Bitcoin (~USD 81–98MM). A notable event was a USD 17.17MM liquidation of a tokenized Brent oil position on Hyperliquid — signaling how the intersection of tokenized commodities and Digital Asset derivatives amplifies cross-asset volatility.

BTC funding rates remained in negative territory during the week, indicating perpetual contracts trading below spot — a bearish derivatives signal, but also a condition that historically precedes short squeezes when combined with bullish catalysts. BTC futures open interest sat around USD 102–112 billion, with new positions predominantly on the short side.

OPTIONS — PERSISTENT PUT SKEW

Following the record Q1 expiry in Week 13, April CME options show a put/call OI ratio of 1.49 and a put/call premium ratio of 9.74 — indicating intense institutional demand for downside protection. Implied volatility sits at ~50%.

BTC: The week followed a now-familiar bifurcated pattern. Monday and Tuesday registered robust inflows (+USD 69.40MM and +USD 117.50MM respectively), with BlackRock's IBIT contributing +USD 98.40MM on Tuesday — the day March officially closed as the first positive net-inflow month of 2026 (~USD 1,320MM), reversing January outflows (-USD 1,610MM) and February outflows (-USD 207MM). However, Wednesday saw the trend reverse with -USD 173.70MM, led by IBIT (-USD 86.50MM) and FBTC (-USD 78.60MM), in line with sentiment deterioration from escalating energy costs and Trump's address. Thursday was marginally positive (+USD 9.00MM). Friday saw no activity due to Good Friday. BTC enters the extended weekend exposed to Monday's reopening with the April 6 Iran deadline as backdrop.

ETH: ETH ETFs broke their prior-week outflow streak with inflows on Monday (+USD 5.00MM) and a strong Tuesday (+USD 31.20MM), where BlackRock's ETHA led with +USD 24.70MM. Wednesday was slightly negative (-USD 7.10MM), but Thursday marked the most severe session: -USD 71.20MM, with ETHA at -USD 46.70MM and ETHE at -USD 16.80MM. The weekly net of -USD 42.10MM reflects that while the consecutive outflow streak was temporarily interrupted, selling pressure returned forcefully Thursday amid Trump's address and the oil escalation.

SOL: SOL ETFs registered minimal activity and a net negative of -USD 5.30MM. Monday opened with -USD 6.20MM in BSOL (Bitwise), and the rest of the week was essentially flat, with a marginal +USD 0.90MM inflow in FSOL (Fidelity) on Thursday. The Drift Protocol exploit likely contributed to institutional caution in SOL ETF flows.