Bitcoin Options Markets Reveal Investors Still Bullish, Despite Repeated BTC Price Failures to Test $30K
Despite repeated failures by the Bitcoin price to test the $30,000 level in recent weeks over the course of the last three weeks, investors remain bullish, according to options market data presented by crypto analytics firm The Block.
Bitcoin has spent the last three weeks trading with $1,500 of the $28,000 level as bulls take a breather in wake of a stunning rally since the start of the year.
Year-to-date, Bitcoin is up in the region of 70%.
And options markets suggest investors are positioned for the upside to continue.
The widely followed 25% delta skew of Bitcoin options expiring in seven, 30, 60, 90 and 180 days were all in the 2-5 region as of Tuesday, with most broadly unchanged in the past three weeks, as is the case with the Bitcoin price.
The 25% delta options skew is a popularly monitored proxy for the degree to which trading desks are over or undercharging for upside or downside protection via the put and call options they are selling to investors. Put options give an investor the right but not the obligation to sell an asset at a predetermined price, while a call option gives an investor the right but not the obligation to buy an asset at a predetermined price.
A 25% delta options skew above 0 suggests that desks are charging more for equivalent call options versus puts. This implies there is higher demand for calls versus puts, which can be interpreted as a bullish sign as investors are more eager to secure protection against (or bet on) a rise in prices.
Importantly for the longer-term Bitcoin bulls, the 180-day skew (last at 5.4) remains close to its highest level since late-2021, reflective of the market continuing to become more and more bullish on Bitcoin’s longer-term prospects.
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