Bitcoin’s Bullish Trend Continues to Surge as Call-Put Skew Reaches 31-Month High

The Rise in Call-Put Skew Indicates Strong Bullish Sentiment

Bitcoin’s bullish trend was highlighted on Thursday as the cryptocurrency’s one-month call-put skew soared above 10%, a level not seen since April 2021. This surge in skew indicates that the demand for call options, reflecting bullish sentiment, was surpassing that for put options.

Optimism Around Spot ETFs Drives Bitcoin’s Price Surge

The spike in the call-put skew coincided with Bitcoin’s price surpassing $36,800, driven by optimism around spot ETFs. This surge led investors to halt selling calls above the spot price, a common yield generation strategy on coin holdings. Instead, speculators sought leveraged upside exposure by purchasing call options.

Market Makers Left with Significant Net Short Exposure

This shift in behavior has left market makers with a significant net short exposure over $36,000. To counterbalance this position and return to market neutrality, market makers are expected to buy Bitcoin, potentially fueling an accelerated rally.

Longer Duration Call-Put Skews Predict Sustained Bitcoin Strength

Looking ahead, longer duration call-put skews predict that the bias for Bitcoin strength will persist for two, three, and six months. This prediction is based on the recent wave of traders purchasing call options, resulting in a bullish bias exceeding 10%, a 31-month high monitored by Amberdata. This increased demand for call options suggests sustained Bitcoin strength over the coming months.

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