Bitcoin traders ease their bullish stance as ETF approval nears – premium for calls falls | CoinDesk JAPAN

As the U.S. Securities and Exchange Commission (SEC) approaches the deadline for approval of a Bitcoin (BTC) spot exchange-traded fund (ETF) (January 10th), the price trend of Bitcoin options is decreasing as traders’ bullish bias narrows. It shows that there is.

According to options skew tracked by Amberdata, calls expiring in one week, one month, two months and three months now sell for 8% versus puts, compared with 8% in early November. It is trading at a premium of approximately 2%. This pullback reflects more cautious bullish sentiment towards Bitcoin.

Bitcoin call-put skew. (Amberdata)

A call gives the buyer the right, but not the obligation, to buy the underlying asset at a specified price at a later date. Buyers of calls are implicitly bullish on the market, and buyers of puts are bearish. Option skew measures the relative demand for calls and puts.

Traders are likely in wait-and-see mode ahead of expected ETF decisions. Cryptocurrencies, which have soared 61% in three months on expectations for the ETF, are likely to fall once the much-anticipated offering is launched, according to some analysts.

The weakening long-term call bias is also consistent with a contrary analysis to the consensus that billions of dollars of inflows into ETFs are likely to occur over time rather than immediately.

Is the market ready?

ATM’s implied volatility, which measures the market’s expectation of price changes over the next seven days, has nearly doubled on an annualized basis since Dec. 29, outperforming longer periods.

Seven-day ATM implied volatility spiked above the longer duration line. (Amberdata)

This is a warning to traders to remain vigilant ahead of and immediately after the January 10 deadline.

On the other hand, longer-term implied volatility continues to rise slightly. Sign traders expect the ETF announcement to have a temporary impact on the extent of price movements, with some analysts even predicting that ETFs will weigh on price movements in the long term. .

｜Translation: CoinDesk JAPAN
｜Edited by: Toshihiko Inoue
｜Image: Amberdata
｜Original text: Bitcoin Traders Pare Bullish Bias as Spot ETF Deadline Nears