BTC Options Change as Traders Monitor BTC Turning Bearish

The key takeaways

• The increasing demand for BTC mining deposits and put-options highlights the growing caution among traders, even though prices are still holding steady at around $108,000.

• The Bitwise analysts argue that deep corrections in the market often precede rebounding, framing it as an a “contrarian buying window”.

BitcoinBTC() dropped to $107 600 on Thursday. This prompted traders to wonder if Friday’s crash was a sign of the end to the bull market that reached its peak on October 6. Traders are on alert after a warning in the Bitcoin option market. A rise in miner exits has also prompted traders to test the level of support at $108,000.

Bitcoin’s options delta skew has risen above 10%. This shows that traders pay a premium to sell put options. This indicator is usually between -6 and +6 under neutral conditions. It is important to note that the skew of this indicator has gotten worse since Friday. That suggests traders are becoming more skeptical regarding Bitcoin’s positive momentum.

The market’s sentiment has been affected by US President Donald Trump’s announcement that the US-China trade war is still ongoing. Trump has threatened further trade restrictions with China after its suspension of US Soybean 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 pressures were increasing. The indicator reached its highest value in 30 days. The average cryptocurrency trader is optimistic. Therefore, a neutral ratio of put to call tends at around -20%. This favors the option called.

Bitcoin derivatives only reflect the worsening US economics

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.

Investors are now willing to take a lower return in exchange for assets backed by the government. 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 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 declines, because miners historically have been the largest Bitcoin holders.

Bitwise analysts pointed out that the extreme drop in sentiment has often been experienced by Bitcoin traders. “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.

The article does not provide legal advice or investment recommendations and it is intended for informational purposes only. This article is solely for informational purposes. It does not represent or reflect Cointelegraph’s views.