Deribit: Institutions do not foresee a sharp Bitcoin correction after rally to $50,000

Institutional investors did not exhibit activity in hedging the decline in the price of the first cryptocurrency after Monday’s drop, which at one point exceeded 8%. This was reported by analysts at the cryptocurrency derivatives exchange Deribit.

3) But whereas Skew has seen near-term action, there is still an absence of any institutional longer-term hedging. In fact, Funds continue (low volumes) to take advantage of selling Jun-Dec <+40k Put strikes. This flow has pressured longer-term IV, while fronts still trade 2-way. pic.twitter.com/OHrRNF4Twp

— Deribit Insights (@DeribitInsights) February 15, 2021

“There is still no long-term hedging by institutional investors. Funds continue to accumulate short positions in put options with strike prices below $40,000 and expiries in June–December,” they noted.

Institutional investors will profit from these actions provided that by the specified time Bitcoin’s price does not fall significantly below $40,000. In that case, the loss would exceed the premiums they collected from put option buyers.

2) Particularly aggressive OTM Put buying on daily Option expiries in the lead-up, Feb11th-14th. All expired worthless but certainly gave concern as a sharp deleveraging wick seemed likely.
It was poor luck the buyer did not continue on the Feb15th expiry.

Put Skew remains firm. pic.twitter.com/adLXa8iHJl

— Deribit Insights (@DeribitInsights) February 15, 2021

Расхождение пут-колл, отражающее отношение стоимости медвежьих ставок к бычьим, остается в негативной зоне на сроке трех и шести месяцев. Это указывает на преобладание оптимистичных настроений на указанном инвестиционном горизонте.

4) The lack of any IV spike on the drop from 49k-46k, and bounce to 48k as I write this, suggests comfort and consolidation in the mid-40s to 50k BTC trading zone.

The term-structure in backwardation (+firm Put Skew) suggests caution, but Feb rolling-over implies not imminent. pic.twitter.com/6CEsXuq7Pg

— Deribit Insights (@DeribitInsights) February 15, 2021

According to Deribit analysts, against the backdrop of the price drop from $49,000 to $46,000 on Monday, followed by a return to $48,000, предполагаемая волатильность avoided a spike. Researchers see in this \”growing chances of consolidation in the range from about $45,000 to $50,000\”.

For the results of January’s Bitcoin options trading, read in нашем материале.

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