In this week’s edition of Option Flows, Tony Stewart is commenting on the recent market movements.
Pre-Bessent US-China trade details, BTC saw large buying of Jun-Sep Call spreads and 1×2 Call spreads.
110-120k Strikes bought, 140+150k Calls sold in Jul+Sep.
Initially, BTC spiked to 106k, but a lack of hashed-out info led to a sell-off.
Some Jun 110k Calls sold softened IV.
2) Data shows Jun 120k focussed buying, funded with selling of Jul+Sep 140k+150k Calls:
- Jun 120k-Jul 150k Call spread bought
- Jul 140k Calls sold.
- Sep 100k-150k 1×2 Call spread bought
- Jun 115k-135k Call spread bought.
- Jun120k-Jul125k Call spread bought.
Jun110k Calls sold.
3) US risk markets (arguably more forward-looking) did not sell-off like BTC, but VIX did retrace <20% as some downside risk is now likely off the table.
BTC+ETH IV also sold off in the same manner.
It’s possible the below chart gives some indication of future IV on Spot moving.
View X thread.
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ex-MS Head of Trading desk /BTC Vol. Prop trading /Option Market forensics/ Alter Ego account Digital Asset arena. Tweets are my opinion, not financial advice.