The DXY hit a 5-month low, and that was good news for Bitcoin, but traders shouldn't get too excited just yet. (Reporting via noshitcoins)
According to the analyst, the net impact for Bitcoin is negative if the expected trajectory confirms with the U.S. dollar gaining strength against major fiat currencies, and the stock market faces another leg down.
Let's look at derivatives metrics to understand better how professional traders are positioned in the current market conditions.Margin markets provide insight into how professional traders are positioned because it allows investors to borrow cryptocurrency to leverage their positions. More importantly, the subsequent $1,250 gain that led Bitcoin to $17,250 on Nov. 30 were not enough to instill confidence in Bitcoin buyers using stablecoin borrowing. Still, presently at 23, the metric favors stablecoin borrowing by a wide margin — indicating shorts are not confident about building bearish leveraged positions.Option traders remain risk-averse
In a nutshell, the skew metric will move above 10% if traders fear a Bitcoin price crash. On the other hand, generalized excitement reflects a negative 10% skew.As displayed above, the 25% delta skew declined between Nov. 21 and Nov. 30, indicating options traders reduced their bets of unexpected price dumps. However, the trend inverted on Dec. 1 after the $17,250 resistance proved stronger than expected.
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