Recent activity on Bitcoin’s options market indicates crypto investors are expecting more gains for the leading cryptocurrency, which is currently just 3% below a record high.
Bitcoin’s presumed one-month volatility, which is governed by the demand for call (so-called bullish) and put (so-called bearish) options, has increased to 81%. This is the highest level since early May this year, after it began the month at 57%, as data provided by Skew shows.
What do investors predict?
A major part of the movement (from 60% to 81%) occurred over the last five-six days. The three-and six-month volatility metrics have also risen to multi-month highest marks.
“Investors are preparing for a bull market consistency,” concluded Vishal Shah, the founder of Alpha5 – a derivatives exchange.
Furthermore, put-call skews, that measure the difference between the cost of put and call bets, are hovering near all-time lows. In short, this means that call options have been attracting more robust demand than puts, a sure sign of investor predictions being heavily skewed to the bullish bets.
Just a week ago, the skews experienced a bounce from all-time lows, as some investors bought put options after Bitcoin’s momentous drop from $18,476 to $17,101.
However, the price drop was short-lived, as the cryptocurrency has sliced above the $19,000 mark on Tuesday. Consequently, call buying continued, pushing the skews on the low again.
Is Bitcoin ready?
On-chain metrics also favor a continuation of the ongoing bull run. For example, Bitcoin’s trade intensity, which calculates the number of times specific Bitcoin deposited on a spot exchange is being traded, has risen to 7.28 on Tuesday. This is the highest level recorded since early June, as pointed out by Chainalysis.
The metric indicates demand is still growing strong and suggests the market can take an eventual rise in supply. In the meantime, holding sentiment is as strong as ever, as suggested by the continuing decline in the number of coins being held on crypto exchanges.
