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Bitcoin options traders await a catalyst in the asset as BTC slips below $27,000

  • Bitcoin options traders are awaiting a catalyst to steer the asset in the right direction, as implied volatility lies in a dormant state. 
  • Investor sentiment is leaning towards neutral ahead of the quarterly settlement based on options data. 
  • Bitcoin price slipped below the $27,000 level as market participants awaited a catalyst and a new narrative in the asset.

Bitcoin options traders expect a catalyst in the asset to boost the volatility in the asset’s price. Closing in on the quarterly settlement of Bitcoin options, the investor sentiment is relatively neutral. BTC nosedived below the $27,000 level in the absence of a new narrative in Bitcoin. 

Also read: Ethereum price steadies above $1,700 as ETH holders grow confident ahead of token unlock

Bitcoin options traders continue hunt for a catalyst, what it means for BTC

Bitcoin, the largest asset by market capitalization continues to experience fluctuations while other altcoins are experiencing a liquidity crunch. Analysts at the options data intelligence tracker Blofin Academy note that with the upcoming quarterly settlement of the crypto market, Bitcoin could experience volatility. 

Implied Volatility(IV) has entered a dormant state as seen in the chart below. IV is the market’s expectation of volatility and formally it is one standard deviation range of expected movement of an asset's price over the course of a year.

Investor sentiment is leaning towards neutral, while in the case of Ethereum it is slightly bearish according to Blofin Academy’s analysts. 

BTC price slips below the $27,000 level

Amidst the rising uncertainty among crypto market participants, BTC nosedived below the $27,000 level earlier today. The largest asset by market capital is exchanging hands at $26,959. 

In the absence of a catalyst and a narrative, options traders expect Bitcoin price volatility to decline or remain relatively low. @tedtalksmacro, a crypto analyst argues that Bitcoin’s ongoing consolidation is part of the asset’s run up to its new all-time high.

The expert compared the current trading environment to the period between September and November 2019. The analyst’s target for Bitcoin’s all-time high is nearly $100,000.

Author

Ekta Mourya

Ekta Mourya

FXStreet

Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.

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