Bitcoin Options Open Interest Has Higher Preference for Put Calls

The world’s largest cryptocurrency Bitcoin (BTC) continues to face sturdy promoting stress. On Monday, May 23, the BTC worth tanked 3% transferring beneath $30,000 regardless of the U.S. fairness market transferring larger.

Bitcoin continues to commerce within the vary of $28,500-$31,500 for some time now. Glassnode information reveals that the BTC market has traded decrease for eight consecutive weeks marking it the longest “continuous string of red weekly candles in history”.

Furthermore, a glance into the Bitcoin derivatives market suggests the dangers of additional draw back, a minimum of over the following three to 6 months. In its newest report, on-chain information supplier Glassnode explains that the Bitcoin choices market continues to cost within the near-term uncertainty.

During the market sell-off final week, the Bitcoin choices implied volatility surged considerably. Glassnode explains:

Short-dated at-the-money choices noticed IV greater than double, from 50% to 110%, while 6-month dated possibility IV jumped to 75%. This is a break larger from what has been a protracted interval of very low implied IV ranges.

Bitcoin Put Options Have Higher Preference

With a really sturdy bearish sentiment, the Bitcoin put choices have a really sturdy choice wanting into the top of Q2 2022. Just over the past two weeks, the Bitcoin put/name ratio for open curiosity has surged from 50% to 70%. It signifies that the market is making ready to hedge additional draw back dangers.

By the top of Q2, there are sturdy put choices with strike costs of $25k, $20k, and $15k. At the identical time, the open name choices are very low. Thus, by the mid of this 12 months, traders have a robust choice for hedging dangers thereby speculating additional draw back worth motion.

On a long-term foundation i.e. by the top of the 12 months, the choices curiosity setup for Bitcoin is notably constructive. Glassnode explains:

There is a transparent choice for name choices, with focus round strike costs of $70k to $100k. Furthermore, the dominant put possibility strike costs are at $25k and $30k, that are at larger worth ranges than the mid-year.

Bhushan is a FinTech fanatic and holds a superb aptitude in understanding monetary markets. His curiosity in economics and finance draw his consideration in direction of the brand new rising Blockchain Technology and Cryptocurrency markets. He is constantly in a studying course of and retains himself motivated by sharing his acquired data. In free time he reads thriller fictions novels and generally discover his culinary expertise.

The introduced content material might embrace the private opinion of the writer and is topic to market situation. Do your market analysis earlier than investing in cryptocurrencies. The writer or the publication doesn’t maintain any duty for your private monetary loss.