Reading BTC and ETH Options Volatility, Skew, and Directional Sentiment
Summary
This weekly market commentary compares BTC and ETH options conditions, focusing on at-the-money implied volatility, volatility term structures, and 25-delta risk reversals. It reports that volatility generally rose, front-end volatility moved above longer tenors, and ETH options continued to carry higher implied volatility than BTC options. The risk reversals indicate a preference for out-of-the-money calls in both markets, while futures yields and perpetual swap funding are described as showing a stronger bullish tone for BTC.
The report uses volatility charts and market indicators as evidence of changing sentiment, noting that recent spot-price direction coincided with a shift in skew from puts toward calls. It offers a snapshot rather than a trading method or forecast; the text provides no detailed chart values or statistical testing. Its authors caution that conditions can change, data may be incomplete, and the analysis is not investment advice.
Key ideas
- The short-tenor volatility structure for BTC and ETH is described as inverted after a rise in front-end implied volatility.
- ETH implied volatility remains above BTC’s across maturities, although its shortest tenors rose less sharply.
- Risk reversals suggest out-of-the-money calls are favored for both assets.
- Futures yields and perpetual funding indicate stronger bullish sentiment for BTC than for ETH.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.