Wall Street Traders Dampening Bitcoin Bull Run Volatility
In a Coin Stories podcast, investor Preston Pysh attributes Bitcoin’s muted price action, despite corporate treasury purchases, to delta-neutral “fast-money” strategies run by Wall Street trading firms. These firms pair spot, futures, and perpetual swaps to extract spreads while suppressing volatility, leading to compressed trading ranges instead of the explosive moves typical of past bull markets. Pysh warns that this volatility squeeze poses a headwind, making the current rally feel less robust and more prone to mean-reversion, even as multi-cycle trends remain upward. He emphasizes the importance of monitoring global equity liquidity as a gauge for Bitcoin’s potential breakout, noting that ample fiat liquidity could support higher prices. However, Pysh cautions that volatility compression is not a guaranteed precursor to rapid gains, advising traders to remain vigilant and avoid assuming a vertical surge to six-figure targets in the near term.
Neutral
Fast-money strategies by Wall Street firms are dampening Bitcoin volatility, leading to sideways price action and headwinds for typical bull-market rallies. While liquidity remains a key factor that could trigger a breakout, the current volatility squeeze suggests limited short-term momentum. Historical parallels with 2017 and 2020 volatility compressions show such phases often precede both breakouts and pullbacks, warranting a neutral stance as the market could either coiled spring toward new highs or falter without adequate liquidity.