Analysis: Bitcoin 30-Day Option Delta Skew Skyrockets, Indicating Market is in Extreme Fear

On August 20th, according to Deribit data, the Bitcoin 30-day option Delta skew (put-call) skyrocketed to 12%, attaining its highest level in more than four months. In a neutral situation, this indicator typically fluctuates between -6% and +6%, which reflects the balanced pricing of call (buy) and put (sell) options. When the level is above 10%, it indicates extreme market fear, but such situations seldom last. Previously, this indicator soared to 13% on April 7th, when Bitcoin fell below $74,500 for the first time in five months. Subsequently, risk-taking investors reaped a 40% return in the following month, with Bitcoin rising to $104,150 on May 8th. Cointelegraph's analysis suggests that there is no evidence indicating the end of Bitcoin's bull market. Traders' fear often exceeds rational expectations. In fact, this cryptocurrency may even benefit from potential outflows from the stock market, suggesting that the current turmoil will not counteract the market's long-term bullish trend.