Bitcoin options traders are showing extreme bearishness on a near-term upside as short traders were active even as Bitcoin surged above $81,000 on Thursday. The jump, a 5% gain in 24 hours, followed a market-wide sense of relief on Wednesday after President Donald Trump's unexpected 90-day pause on tariff hikes.
Deribit, a crypto derivatives exchange, shows options data indicating a bearish sentiment for April, with the most popular trade being $70,000 put bets. These bets are a good thing if the price of Bitcoin never goes above $70,000. There are reasons to be hopeful come later this year, according to analysts.
"We continue to see topside selling in Bitcoin options for May and June." - Analysts at QCP Capital
May and June were exceptionally heavy selling periods for Bitcoin options, according to QCP Capital. This is indicative of a trader market that is skittish of betting on large upward moves coming soon.
This caution comes even as Arthur Hayes, co-founder of BitMEX and chief investment officer at Maelstrom, predicted Bitcoin will trade at $250,000 this year.
Joel Kruger, a crypto-asset market strategist at LMAX Group, noted that changing macro dynamics have played a role in shaping Bitcoin’s current trajectory. These dynamics encompass an eventual Federal Reserve pivot and a deepening US commercial squeeze.
"The purchase of December $100,000 calls points to longer-term optimism for Bitcoin to revisit the $100,000 milestone later towards the end of this year." - Analysts at QCP Capital
According to QCP analysts, any wobble Bitcoin goes through in 2025 will soon be followed by a sharp recovery. The delay on tariff increases provided global markets with a welcome reprieve. What it all means long term for Bitcoin itself remains less certain.
"Bitcoin appears well-positioned to trend higher through year-end even if US equities face further downside." - Joel Kruger, market strategist at LMAX Group
Analysts at QCP believe any wobble Bitcoin experiences in 2025 will likely be followed by a sharp recovery. The pause on tariff hikes provided a temporary boost to global markets, but the long-term impact on Bitcoin remains to be seen.
