SIG-132 geopolitics SHADOW 🕶 SHADOW

Israel closes its airspace by May 31?

Direction NO underpriced · Confidence LOW · Closes 2026-05-31

Market price

34%

at signal

Our estimate

30%

calibrated

Gap

+4.3pp

market vs ours

Status

SHADOW

2026-05-31 close

Market price history

Evidence

Israel airspace closures are rare baseline events historically (<5% per random week)
34.5% implied probability is unusually high, suggesting market is pricing in active escalation risk (Iran/Hezbollah/Houthi missile threats)
7-day window is short, limiting time for escalation to materialize
Volume of ~$994k indicates moderate liquidity and price discovery
Without real-time intelligence on current Israeli MOD/IDF advisories or NOTAMs, I cannot confidently estimate true probability

Counter-evidence

Active Middle East kinetic activity in May 2026 could justify the 34.5% pricing if Iran/proxy retaliation threats are credible, meaning the market may be efficiently priced rather than mispriced.