The high volatility in the stock market is far from over. The ceasefire in the Middle East is a big bet on a significant cooling down, preparing for a "chain reaction of surging and plunging".

As the military conflict between the United States/Israel and Iran continues, the global financial markets remain turbulent. Investors are still uncertain about when a potential ceasefire may occur, and the expected timeline for market "bets" on the ceasefire has been significantly pushed back from the end of March to the end of June or even December. The ongoing military-level attacks near the Strait of Hormuz one of the world's most critical shipping corridors undoubtedly exacerbate concerns about global trade disruptions, inflation or stagflation pressures rising, and increased volatility in global stock markets. "High volatility is the common enemy of all investors and professional traders," this statement is increasingly evident and significant in the current environment of extreme volatility. Veteran Wall Street traders and some institutional investors are betting that high volatility in the global stock markets will continue in the short term (the next month) meaning that the more reasonable scenario for the stock market is not a "one-sided crash," but a series of sharp rises and falls under the constraint of high oil prices, and this intense volatility may continue to rise until the first ceasefire is reached in the mid-term range. The Middle East war is causing the "largest oil supply disruption in history," with global supply expected to decrease by 8 million barrels per day in March. The blockade effect on crude oil flow in the Strait of Hormuz exceeds 20 million barrels per day, accounting for about 20% of global consumption. Given this scale, whether it is the release of 172 million barrels of strategic oil reserves by the United States, the coordination of a record 400 million barrels of strategic oil reserve releases by the International Energy Agency, or the latest exemption measures by the U.S. government regarding Russian oil resources, analysts generally believe that these actions can only "slow down or temporarily suppress the upward trend," and cannot address the core contradictions of supply shock. With limited progress on the diplomatic front, the uncertainty surrounding the direction of the conflict continues to weigh heavily on the global financial markets. Before the stock market returns to a relatively calm period, it may have to endure weeks of intense volatility and turmoil. Some options market traders are betting that the most difficult phase of intense volatility in the stock market will continue for another week or even a month, until after the formal meeting between the leaders of the two largest economies in the world, and only then will it return to a relatively stable trading pattern. According to the latest betting data from prediction platform Polymarket, traders seem to unanimously believe that an official ceasefire in this geopolitical conflict is more likely to occur after the middle of this year. Compared to the early March, the tendency is more towards both sides officially ceasing fire in the second half of the year, rather than as optimistically expected by some Wall Street analysts to happen in the near future. The probability compilation data from Polymarket shows that the likelihood of a ceasefire by June 30th is 59%, and by December 31st it is as high as 77%; while the probability of a ceasefire agreement by the end of March is significantly lower. Prediction markets like Kalshi and Polymarket have gained global popularity since the end of the 2024 U.S. presidential election when almost everyone was keen on betting real money on whether Trump or Harris would win the election on the paid prediction market platform Polymarket. This trend highlights the trend of "everything can be bet on" in prediction markets, but it quickly touches upon regulatory and ethical red lines. Based on the latest betting data from Polymarket, the probabilities given by traders for when a ceasefire between the United States/Israel and Iran may occur are as follows: Before March 15th Probability 1%. Before March 31st Probability 22%. Before April 15th Probability 32%. Before April 30th Probability 41%. Before May 31st Probability 54%. Before June 30th Probability 59%. Before December 31st Probability 77%. Sharp rises and falls continue to play out! Panic-inducing "high volatility" is sweeping through global stock markets "High volatility is the common enemy of all professional traders," this statement is especially true in the current environment. High volatility is set to continue in the short term at least. The real danger of this intense volatility for professional funds is not just the difficulty in determining the direction, but also that it will simultaneously increase hedging costs, shorten tolerance for holdings, compress leverage efficiency, and may result in correct fundamental judgments losing to mistimed entries. In other words, what traders are now fighting against is not a single trend, but oil price jumps, frequent market reversals, systematic fund rebalancing, hedge fund credit and AI panic noise. Traders are now dealing not with a single trend, but with oil price jumps, frequent market reversals, systematic fund rebalancing, hedge fund credit and AI panic noise in other words, geopolitical conflicts only briefly shift market focus from "whether asset pricing under multiple threats is too high to whether conflicts are escalating, and once the latter cools down, the former will become the dominant variable again. The more reasonable scenario for the current market is not a "one-sided crash," but a series of sharp rises and falls under the constraint of high oil prices. Unless the situation in the Middle East becomes clearer and verifiable, oil prices drop significantly, systemic selling pressure stages end, and macro risks are actively digested, global stock markets in the short term will be more like in a period of high volatility for price discovery, rather than a stable trend market. The market is not currently in a stage of "waiting for repair after panic bottoming out," but in a zone of continued selling pressure due to prolonged geopolitical conflict, oil prices above $100, and ongoing erosion of asset pricing. Rich Privorotsky, head of trading business at Goldman Sachs, believes that the real problem now is not whether sentiment is already bearish, but that the fundamentals are still deteriorating the partial blockade of the Strait of Hormuz is pushing up energy costs, U.S. bond yields are rising, the stock market is slowly bleeding, and emerging markets are lacking a rebound. This means that the market currently lacks a clear exit to stabilizing and rebuilding risk appetite. In other words, technical and positioning may support a short-term rebound, but the macro trend still remains bearish. In addition, selling pressure in the market has spread from the surface of oil prices to the deeper layers of interest rates, credit, and profits. Privorotsky describes the current interest rate curve as showing typical "late-cycle tightening" features: rising yields and a flattening curve, a combination that has historically been particularly unfriendly to equity assets, especially hitting small-cap stocks and financial sectors harder. At the same time, cracks are starting to appear in the credit market, with events like restrictions on redemptions for hedge funds being seen as a real red alert; and although Europe has slightly outperformed in the short term due to short covering and fund rotation, high natural gas prices and rising energy costs will eventually compress corporate profit expectations, so-called "relatively resilient Europe" is more of a temporary phenomenon at the trading level, rather than a fundamental improvement. Privorotsky also believes that Iran's strategy can be seen as a low-cost, long-term, market-focused war: using limited disturbances in the strait and supply suppression to push up oil prices continuously and hit risk assets, without seeking immediate military victory. Based on this logic, his latest trading view is not to bet on an immediate market crash, but the longer the geopolitical conflict drags on, the deeper the damage to asset prices in the medium term, therefore maintaining a cautious sentiment is currently the most reasonable trading stance.