Bitcoin Option Positioning Shifts Bearish Amid Price Drop and Increasing Hedging Activity
Bitcoin (BTC) option positioning has shifted markedly from bullish to bearish, with put options now leading in open interest. The $85,000 put option holds about $2.05 billion in open interest, surpassing the $140,000 call, which has declined to approximately $1.63 billion from higher previous levels. The $80,000 and $90,000 puts have eclipsed the $140,000 call, signaling increasing demand for downside protection.
BTC price currently hovers around $91,000, reflecting a decline of over 25% since October 8.
Front-end implied volatility stands near 50%, accompanied by a notable put skew between +5% to +6.5%, evidencing heightened demand for downside hedging. Derive.xyz reports the 30-day skew at about -5.3%, indicating rising hedging activity on Bitcoin's downside.
There is a concentration of puts expiring December 26 around the $80,000 strike, suggesting near-term bearish hedging interest. The macroeconomic backdrop remains cautious, with concerns around U.S. jobs data and a rate-cut probability barely exceeding a coin toss.
Despite bearish positioning, technical indicators are signaling oversold conditions: the Fear & Greed index is near 15, and the Relative Strength Index (RSI) is around 30. Additionally, whale wallets holding over 1000 BTC are increasing, implying smart-money accumulation at these lower price levels.
