Key Updates

• The 180-day call-put skew on Deribit is now at its most significant negative since over two years.
• Bitcoin’s price has dropped below critical moving average bands, indicating a possible trend reversal.

Overview

Bitcoin indicators lean toward a bearish trend as traders anticipate insights from Federal Reserve Chairman Jerome Powell during the Jackson Hole Symposium.

The 180-day call-put skew from options trading on Deribit, the largest crypto options exchange, is reflecting increased bearish sentiment according to market analytics.

As of now, the skew metric stands at -0.42, marking its lowest level since June 2023. This negative skew suggests that traders are positioning themselves for future price declines, showing heightened caution in the market.

Insights

Imran Lakha of Options Insights reflects that, “BTC’s longer dated skew flipping into put premium could signal a regime shift.”

Market Expectations

Jerome Powell is anticipated to address the central bank’s annual event on Friday. Market analysts speculate that he will hint at potential rate reductions starting from September. Nicolai Sondergaard from Nansen notes that if these expectations are met, the crypto market might take on a sideways or slightly bearish tone. Conversely, signal for deeper cuts could trigger bullish activities.

Stock Market Dynamics

As Bitcoin’s downward pressure increases, this trend correlates with Wall Street behaviors, where traders are preparing for a sell-off in major tech stocks by purchasing put options.

Indicators That Matter

Prominent indicators like the Guppy multiple moving average and MACD are also suggesting increased bearish momentum, advocating caution among traders. These insights from technical analyses could provide critical foresight into market movements.

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