Bitcoin and Ether Traders Hedge Against Summer Drop with Options
Savvy bitcoin traders are employing 25-delta risk reversals on Deribit to hedge against potential summer volatility. Data from Amberdata show negative risk reversals for BTC in June, July and August, indicating higher demand for puts over calls. Similarly, ether traders are paying up for downside protection through pricier put options out to July expiries. Singapore-based QCP Capital notes long holders are actively hedging spot exposure in both BTC and ETH, preparing for drawdowns. Bitcoin’s price has traded sideways around $100,000, dipping below its 50-day SMA for the first time since April, raising the risk of a slide under $100K. Nonetheless, some analysts expect a rebound to $130,000–$135,000 by Q3’s end, supported by strong on-balance volume. Overall, options hedging points to cautious sentiment among bitcoin investors and ether holders seeking market protection as summer approaches.
Bearish
The surge in demand for put options and negative 25-delta risk reversals indicates that traders expect downward pressure on bitcoin and ether prices, a historically bearish signal ahead of summer. Bitcoin’s breach below the 50-day SMA further supports short-term downside risk, mirroring past summer sell-offs when volatility spiked. Although some analysts foresee a Q3 rally to $130K–$135K, the dominant use of options hedging suggests market participants are prioritizing protection over bullish bets, pointing to a bearish outlook in the near term.