Glassnode: Bitcoin's Rallies Are at Risk

Recently observed volatility in the price of Bitcoin has drawn the attention of investors. According to data from the on-chain analysis platform Glassnode, the increasing demand for put options in the Bitcoin derivatives market may put further pressure on prices.

In particular, the rise in protective positions taken by investors against downside risk is noteworthy. Glassnode highlights that the sharp increases in the 25-delta skew indicator indicate that investors are increasingly opening protective positions for hedging purposes, pricing in the market's fear sentiment. This situation is considered an important warning signal across the market.

Analyses have shown that increases in the 25-delta skew indicator often coincide with short-term dips. These levels, where sentiment is negative, indicate periods of intensified selling pressure. Analysts also state that this situation carries the potential for the formation of a short-term bottom.

What is 25-delta skew? This indicator is an important criterion for assessing market risk by measuring the value difference between put options and call options in the options market. If this value continues to rise, the increasing fear and expectation of declines in the market may elevate the risk of any rise in Bitcoin turning back into selling pressure.

In conclusion, the high demand for protection against declines can affect market psychology, limiting Bitcoin’s recovery efforts. It is important for short-term traders to closely monitor this situation. A critical point for investors is to track changes in the 25-delta skew indicator and assess market sentiment.