Bitcoin traders are increasingly hedging hedges against potential slump. This is a sign of growing attention as the broader financial markets recede ahead of the major US economic data.
The options market where investors buy contracts where they bet or protect future price movements indicates traders are positioned defensively.
According to Nick Forster, founder of Onchain Derivatives Platform Derive.xyz, demand for protection contracts is increasing, especially because of the so-called Put options.
“Derivatives are currently positioned defensively, with immediate 25-DELTA call/put skew hitting the lows of 2025,” Forster said.
Simply put, traders have paid more for downside protection than at any point this year, with many focusing on contracts that allow them to sell Bitcoin in the $75,000 to $70,000 by the end of March.
At the same time, demand for call options that grant the right to purchase at a fixed price has weakened.
Many contracts that previously profited at the market price of Bitcoin are now located at a higher level. In other words, traders believe that betting on quick running is less urgent.
“This creates a completely muted volatility and there’s very little excitement up to the $100,000 range,” Forster said. “We feel the current market is uncertain and traders are prepared for potential volatility in either direction.”
Early Asian trading revealed that some inconsistent signals have emerged, according to QCP Capital.
“This potentially demonstrates quick rebound positioning from the $75,000 support level,” QCP wrote in a note Tuesday.
In fact, the price of the world’s largest crypto jumped 82,375 times to 3.8% in the last 24 hours, recouping previous losses of nearly $77,000.
Either way, the defensive tone of Bitcoin trading reflects broader market sentiment.
On Monday, the S&P 500 fell 0.76%, while the Dow Jones Industrial Arage lost 1.14%.
According to MarketWatch, economists expect headline inflation to rise by 0.3% in February, with annual CPI rates falling to 2.9%.
It could provide some relief for risky assets, including crypto and stocks, but the Federal Reserve will give you confidence to consider when it will be the next rate reduction cycle. Decryption I was told.
In Europe, the Stoxx 600 index fell 1.43%, but oil prices were higher, with Brent crude at $69.97 per barrel.
