Bitcoin and altcoins are moving from bearish to bullish sentiment. Therefore, it is important for the crypto market to closely follow the important events that should be considered in February.
In a bullish trend for Bitcoin and altcoins
cryptocoin.comAs you follow, despite the recent negative impact of the macroeconomic environment and bankruptcies, Bitcoin and altcoins have managed to rise since the beginning of 2023. All this started when Bitcoin (BTC), the world’s first cryptocurrency, entered the recovery phase as the year 2023 began. This recovery phase was followed by Ethereum and other major altcoins, which currently raise the global crypto market cap to over $1 trillion.
Also, trading desk QCP Capital, an analytical platform, claims that Bitcoin has been in a bullish trend over the past week. According to the analysis, this positive pattern affects options trading and indicates skewness. In this context, QCP Capital shares the following assessment:
Market conditions are drastically different from the downtrend we saw in Q4 2022. The current state of the options market makes it seem like FTX never happened! BTC risk reversals traded in positive territory on multiple tenors last week for the first time since 2021 (Calls are more expensive than Puts).
Put skew is nothing more than a phenomenon where puts are higher and calls are lower. By the way, the price difference in options is called skewness. Here puts are higher than calls because traders hold some of their bullish positions.
The crypto market is at an important juncture
On the contrary, Michael van de Poppe, a well-known crypto analyst, has a bearish bias against Bitcoin. The analyst claims that Bitcoin is ready to break out and hit a target of $24,000. However, Van de Poppe predicts that Bitcoin will later slide towards $22,000 and test the $20,000 levels. Accordingly, the analyst makes the following statement:
Chop, that’s what we’re seeing here. It could be a distribution that we head south to test some levels and liquidity for Bitcoin. If it breaks $23.1k – it will test $24,000. If it loses $22.3k – it tests $20,000.
Also, the trading desk states that traders go for a long time in the spot market. This indicates the entry of the fear of losing. This also means that most of the traders focus on the price which leads to buying high delta calls. QCP Capital shares the following assessment:
ETH implied volatility (IV) fell overall. Also, market prices point to a relief as it removes the fear of falling prices. In light of the Shanghai Upgrade, which will see more than 16 million ETH unlocked, ETH end-March IV can be expected to remain very high. Anecdotally, we see FOMO starting from the flows on the trading desk. Many are chasing the top this week by buying high delta calls and going to the long spot.
Additionally, the QCP analysis shows a turnaround in the current bull market following the release of the CPI report scheduled for February 14, 2023. Therefore, next week will play an important role for the future crypto market.
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