BTC Options Change as Traders Monitor BTC Turning Bearish

The key takeaways

• The growing demand for BTC miner deposits and put options highlights the increasing caution of traders, despite the price stability near $108,000.

• Bitwise’s analysts claim that market sentiment typically drops sharply before a rebound, describing the correction in this way. “contrarian buying window”.

BitcoinBTCThe price of Bitcoin (BTC) dropped from $107,600 to $107,600 in the early hours of Thursday morning, leading traders to ask if the flash crash on Friday was the beginning or end of a bull run which peaked on the 6th October at a record high. A warning in the Bitcoin options market sent traders into a frenzy, as the outflow of miners increased. They were testing the level of support at $108,000.

Bitcoin delta skew is now above 10%. Professional traders pay more for sell (put) options. This indicator is usually between -6 and +6 under neutral conditions. The skew is worse since Friday. This suggests that traders have become more skeptical about Bitcoin’s upward momentum.

The market’s sentiment has been affected by US President Donald Trump’s confirmation of the ongoing trade war between China and the US. Trump has warned that he will further restrict the trade between China and US following China’s suspension of US soya purchases. according Yahoo Finance. The uncertainty around US economic data during the government shutdown is another factor that adds pressure.

Deribit’s demand for protection against the downside surged Thursday, when trading volumes of put options outnumbered call options 50%. It was a sign that market pressure was increasing. The indicator reached its highest value in 30 days. A neutral reading of the put-to call ratio is around -20% for cryptocurrency traders, which favors calls.

Bitcoin derivatives only reflect the deteriorating US macroeconomics

As gold reached a new record on Thursday, investors’ sentiments have shifted. Demand for short-term US government bonds also spiked, even as two Federal Reserve Governors signaled further interest rate cuts in October — a move that typically reduces the appeal of fixed-income investments.

The yields of the US 2-year Treasury fell to the lowest levels in over three years. This shows that investors will accept lower returns for government-backed assets. Gold has risen to $4300, a 23% increase since September. This puts the gold reserves of central banks above those of US Treasurys. according Reuters.

Despite positive developments in the tech sector, including chipmaker TSMC’s (TSM) upgraded 2025 outlook and strong quarterly results from Bank of America and Morgan Stanley, the S&P 500 fell 0.9% on Thursday. Dow Jones US Select Regional Banks Index fell 4.4% following two financial companies reporting losses on the private credit market. according The Financial Times

Related: SEC chair: US is 10 years behind on crypto, fixing this is ‘job one’

Concern has also been raised about the movements of addresses linked to Bitcoin miners. Data CryptoQuant reports that in the seven-day period ending July 1, miners had deposited more than $5.5 billion (or 51,000 BTC) at exchanges. This is the highest outflow of bitcoins since July. This behavior is often a precursor to price drops, because miners historically have been the largest Bitcoin holders.

Bitwise analysts noted that while the Bitcoin options market has warned of a possible further decline in Bitcoin sentiment, extreme falls have occurred before. “marked favorable entry points,” Add to that “the recent correction was driven largely by external factors.” Bitwise head of research André Dragosch added that Friday’s liquidation event has set the stage for a “contrarian buying window.”

Bitcoin could still fall further, however, the increase in put option demand should not be interpreted as an indication of a sustained downward trend, because external factors may have made traders less risk-averse.

This is only a general article and not a legal or investment advisory. These are solely the opinions, views and thoughts of the author and may not reflect the opinions and views of Cointelegraph.