Understanding the Recent Reversal in Bitcoin Options: Analyzing the 25% Delta Deviation Numbers

On March 20th, it was reported that as the price of Bitcoin rose to the range of 28000 US dollars, there was a reversal bullish trend in Bitcoin options. The 25% Delta deviation of 7, 30, 60, 90, and 180 days has returned to the bullish region, with relevant indicator values approaching 5. Among them, the 25% Delta deviation of 7 days has reached the highest level since February 2022, and the 25% Delta deviation of 180 days has reached the highest level since November 2021.

Bitcoin options market 180 days 25% Delta deviation has reached the highest level in November 2021

Bitcoin, the world’s largest cryptocurrency, has been on a historic run in recent months. On March 20th, Bitcoin’s price reached a new high of $28,000, breaking through the previous resistance level of $20,000. With this surge in price, there has been a reversal bullish trend in Bitcoin options that merits examination. In this article, we will analyze the 25% Delta deviation numbers to help understand the recent reversal in Bitcoin options.

What are Bitcoin options?

Bitcoin options are contracts that allow traders to buy or sell Bitcoin at a specified price within a given time frame. These contracts give traders the right, but not the obligation, to execute the contract. Bitcoin options provide a useful way for traders to mitigate risk while still gaining exposure to Bitcoin.

Reversal Bullish Trend in Bitcoin Options

As Bitcoin’s price has climbed, there has been a reversal bullish trend in Bitcoin options. The 25% Delta deviation of 7, 30, 60, 90, and 180 days has returned to the bullish region, with relevant indicator values approaching 5. This indicates a positive shift in sentiment among investors, who are now more bullish on the future price of Bitcoin.

Analyzing the 25% Delta Deviation Numbers

The 25% Delta deviation numbers provide a useful way to understand the trend in Bitcoin options. The Delta is a measure of how much the Bitcoin price changes for every $1 change in the price of the option. The 25% Delta deviation is a measure of the volatility of these changes.
Of the five Delta deviation numbers analyzed, the 25% Delta deviation of 7 days has reached the highest level since February 2022, and the 25% Delta deviation of 180 days has reached the highest level since November 2021. This suggests that the trend in Bitcoin options is becoming more volatile, with larger swings in the price of the option compared to the price of Bitcoin.

Reasons for the Recent Reversal

There are several possible reasons for the recent reversal bullish trend in Bitcoin options. In part, this trend may be due to increased institutional interest in Bitcoin. Many large companies, such as Tesla and Square, have recently invested in Bitcoin, which has helped to legitimize the cryptocurrency in the eyes of traditional investors.
Additionally, the recent stimulus package passed by the United States government may be contributing to the bullish trend in Bitcoin options. Many economists believe that the stimulus package will lead to inflation, which could drive up the price of Bitcoin as investors seek a hedge against inflation.

Conclusion

The recent reversal bullish trend in Bitcoin options is a positive sign for those who are bullish on Bitcoin. The 25% Delta deviation numbers suggest that investors are becoming more confident in the future price of Bitcoin, and are willing to take on more risk to gain exposure to the cryptocurrency. However, this trend is also becoming more volatile, with larger swings in the price of the option compared to the price of Bitcoin.

FAQs

1. What is a bullish trend in Bitcoin options?
A bullish trend in Bitcoin options refers to a trend in which investors are becoming more confident in the future price of Bitcoin, and are willing to take on more risk to gain exposure to the cryptocurrency.
2. What are Delta deviation numbers?
Delta deviation numbers are a measure of the volatility of changes in the price of Bitcoin options.
3. What are some of the reasons for the recent reversal bullish trend in Bitcoin options?
Increased institutional interest in Bitcoin, as well as the recent stimulus package passed by the United States government, may be contributing to the recent reversal bullish trend in Bitcoin options.