1/6: A take on BTC market structure through options.
Current market structure is not yet stable. We went from capitulation in 2018 to stabilisation early 2019, to bull market and then to capitulation Mar 2020. Let's look at options skew (calls vs. puts).
Current market structure is not yet stable. We went from capitulation in 2018 to stabilisation early 2019, to bull market and then to capitulation Mar 2020. Let's look at options skew (calls vs. puts).
2/6: Early 2018 we are still in a bear market, complete capitulation was still lacking. Market retesting the 6k level multiple times, support holding. Still more call skew than put skew.
3/6: Nov 2018 break down of the 6k level, new lows. Fully fledged market panic. Crypto is dead. Where is the floor? Put skew explodes.
4/6: It needed a long consolidation (early 2019) to believe the worst is over. After new higher lows the market structure reclaims trust. Put skew starts dropping out.
5/6: Late Q119, bull market roaring, fear of new lows gone. Where is the ceiling? The support between 6k and 7k holds solid. Even despite the decline in June, the market lacks capitulation. Put skew gone, mostly strong call skew.
6/6: March 2020. Massive drop. Complete capitulation. Market structure, despite the extreme rally is still not in a "stable" condition. We need to see higher lows and a solid range.
I think this would be the moment, when call skew might come back.
I think this would be the moment, when call skew might come back.
