Implied volatility for $BTC has fallen to a five-year low, just as the price slipped below $82,000.
$BTC is currently trading around $81,800, down more than 2% in 24 hours and nearly 6% from its recent peak early last week of around $87,000. At the same time, the implied volatility index in the options market has dropped to its lowest level in five years.
Several sources tracking the options market have confirmed this volatility reading, noting that options premiums are now unusually cheap compared with recent actual price movements.
With premiums so cheap, some investors are taking the opportunity to buy put options to hedge against further declines, rather than making a one-way bet.
Unusually low implied volatility while prices are falling is a strange signal, since the options market typically reacts more strongly than the spot market—not the other way around.
Watch to see whether volatility bounces back when the price reaches the $80,000 zone.
Personal observation, not investment advice
#BitcoinOptionsVolatilityHitsFiveYearLow #TinFed #BTC
$BTC is currently trading around $81,800, down more than 2% in 24 hours and nearly 6% from its recent peak early last week of around $87,000. At the same time, the implied volatility index in the options market has dropped to its lowest level in five years.
Several sources tracking the options market have confirmed this volatility reading, noting that options premiums are now unusually cheap compared with recent actual price movements.
With premiums so cheap, some investors are taking the opportunity to buy put options to hedge against further declines, rather than making a one-way bet.
Unusually low implied volatility while prices are falling is a strange signal, since the options market typically reacts more strongly than the spot market—not the other way around.
Watch to see whether volatility bounces back when the price reaches the $80,000 zone.
Personal observation, not investment advice
#BitcoinOptionsVolatilityHitsFiveYearLow #TinFed #BTC