Originally published on: November 02, 2024
Despite a slight pullback in Bitcoin’s price after reaching a weekly high on October 29th, the derivatives market is still showing positive signs of trader optimism for a potential recovery.
Analysis of Bitcoin futures and options markets reveals that traders are holding positions without excessive leverage, indicating a sustainable path towards new all-time highs. Understanding the factors behind Bitcoin’s recent drop below $69,000 on November 1st is crucial for predicting future market movements.
The metrics for Bitcoin 1-month options delta skew and funding rates for perpetual contracts suggest that traders remain cautiously optimistic. The delta skew indicates demand for put options, while the funding rate remains neutral, signaling a lack of strong conviction either way.
The recent correlation between Bitcoin’s price movement and the S&P 500 index suggests that both markets are reacting to similar macroeconomic indicators, such as recent financial disclosures from tech giants and economic reports.
With upcoming events like the US presidential elections and the Federal Open Market Committee decision, market analysts are closely watching for potential impacts on the economy and the US dollar, which could in turn affect Bitcoin’s price in the medium term.
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