Retail investors are largely still on the sidelines. So, is now a good time to deploy some capital?

Here's what a key data point suggests.

The $BTC 25 Delta Skew is a contrarian indicator. Whenever it drops below -10%, there is a high probability of a price surge (historically at least).

In the image, you can see $BTC's price in black and the Delta Skew in orange. The lows are marked with black circles, and you'll notice price jumps (or at least not declines) shortly after those events.

Image of $BTC price in black and the 25 Delta Skew (1 week) in orange.

We're in a bull market, so the threshold seems to be <= -9.8% rather than -10%.

The idea is the same, however. You are betting against degens. In this case, the bet is that options traders are too pessimistic. So, they'll get rekt and $BTC will surge.

I like betting against degens.

At present, the Skew Delta is not at a sufficient level; it's at roughly -8.6%. Notice how the last circle is below the orange line? That's exactly my point: almost, but not quite. Perhaps by the end of the trading day, we'll reach that point.

What should you do?

I'm not telling you to do anything. This is not financial advice. Do your own research.

I'm simply reporting that the 25 Delta Skew is pretty close to the threshold where, historically, $BTC rises rather than crashes. That would seem to suggest that a big price decline is unlikely.

Happy Trading!

- Sebastian Purcell, PhD