Bitcoin (BTC) traders are heavily positioning themselves against further downturns, with over $1.15 billion in bearish options pouring into the market within the last day, as reported by derivatives tracker Greeks.live. This activity suggests a substantial shift towards downside protection as Bitcoin continues to navigate through a challenging mid-October period.

Preparing for Market Volatility

In a post on X, Greeks.live observed marked signs of anxiety within the options market. The option trades are focused primarily on out-of-the-money (OTM) puts, striking between $104,000 and $108,000, which will expire soon. Concurrently, the options skew, indicating the cost relation of puts to calls, has turned notably negative, signaling that liquidity providers and market makers are the driving forces behind this trend.

“Options participants — particularly large liquidity providers/market makers — are pricing in substantial downside risk, with sentiment nearing that seen after the broader market drop on the 11th,” stated Greeks.live.

This cautious sentiment is echoed in spot market behaviors, with Bitcoin trading around $110,076, showing a 2.3% loss in the last day and a 9.4% decline over the week.

Additional insights from CryptoQuant indicate a growing volume of deposits to exchanges and a high percentage of selling orders, hinting at ongoing selling pressure.

A Market at a Crucial Turning Point

This market caution follows one of the largest liquidation events in crypto history which wiped out $19 billion on October 10, resetting many over-leveraged positions. Despite a slight recovery, data shows Bitcoin entering a speculative phase. The Net Unrealized Profit/Loss (NUPL) ratio stands at +0.52, a level often linked with late-cycle euphoria.

With many new investors currently leading the market, long-term holders are focused on taking profits. Analyst Joe Consorti noted that historically, negative performances in mid-October often lead to a positively closing month. He adds that the recent downturn could be essential for addressing excessive optimism tied to seasonal expectations of an upward market in October, potentially leading into a lengthy cycle extending into 2026.

This analysis underscores a critical moment for Bitcoin as it navigates a complex landscape of declining prices and strategic positioning among traders.