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Bitcoin options market conviction Glassnode report: Can BTC hit $97,600?

January 23, 2026

📝 Executive Summary (In a Nutshell)

  • Glassnode's analysis of Bitcoin's recent rally to $97,600 indicates a surge in short-dated call demand, but a lack of conviction in longer-term options pricing.
  • Key metrics like longer-dated options skew remained in put asymmetry, and implied volatility was sold, suggesting tactical positioning rather than a broad-based, high-conviction bullish shift.
  • For Bitcoin to revisit $97,600 with sustained momentum, traders should monitor for a consistent lift in longer-dated skew out of put territory and implied volatility being bid, not sold.
⏱️ Reading Time: 10 min 🎯 Focus: Bitcoin options market conviction Glassnode report

The cryptocurrency market, with Bitcoin (BTC) at its vanguard, is a crucible of rapid price movements, complex derivatives, and intricate on-chain data. When Bitcoin surged towards the psychological benchmark of $97,600 last week, it naturally sparked a wave of bullish sentiment and frenetic options activity. However, in the nuanced world of market analytics, not all rallies are created equal. On-chain analytics powerhouse Glassnode, through a detailed thread on January 23, offered a critical perspective, suggesting that the derivatives market's reaction to BTC's push was more indicative of short-dated, tactical positioning than deep-rooted, broad-based conviction.

As a Senior SEO Expert and market analyst, understanding these subtle distinctions is paramount. It allows us to differentiate between speculative froth and genuine market shifts, providing a clearer lens through which to view Bitcoin’s potential trajectory. This analysis will deep dive into Glassnode's findings, dissecting the metrics that informed their cautious outlook and outlining what traders should truly monitor for a "cleaner breakout" that could sustain a move towards—and potentially beyond—$97,600.

Table of Contents

Glassnode's Insights: A Skeptical Look at Bitcoin's Rally

Bitcoin's ascent last week, touching $97,600, was undoubtedly an exciting moment for many in the crypto space. However, Glassnode’s meticulous analysis of the options market revealed a disconnect. While there was an observable increase in demand for front-end (short-dated) call options, indicating short-term bullish bets, this exuberance failed to translate into a significant repricing of longer-dated risk. In essence, the market seemed to be hedging its bets, with conviction for upside remaining largely confined to the immediate horizon, while longer-term options continued to price in the possibility of downside risk. This dichotomy forms the core of Glassnode's argument: the rally lacked the deep, broad-based conviction often associated with sustained breakout moves.

Understanding the Options Market: Key Metrics Explained

To fully appreciate Glassnode’s findings, it’s essential to grasp the fundamental concepts of options trading and the metrics they utilized. Options are derivative contracts that give the buyer the right, but not the obligation, to buy or sell an underlying asset at a specified price (strike price) on or before a certain date (expiry). Their pricing and volume offer profound insights into market sentiment and expectations.

Call and Put Options

  • Call Options: Give the holder the right to buy an asset at a set price. Traders buy calls when they expect the price to rise.
  • Put Options: Give the holder the right to sell an asset at a set price. Traders buy puts when they expect the price to fall, often for speculation or downside protection.

Implied Volatility (IV)

Implied volatility is a crucial metric that reflects the market's expectation of future price swings in the underlying asset. It's not a historical measure but a forward-looking estimate. When implied volatility is high, options premiums are more expensive, signaling market participants anticipate larger price movements. Conversely, low IV suggests expectations of calmer markets. Glassnode's observation of "vol being sold" is critical, implying that market makers and other participants were taking advantage of the rally to sell options, essentially betting against sustained large moves, rather than bidding up options in anticipation of further, significant upside.

Options Skew (25-Delta Skew)

Options skew measures the difference in implied volatility between out-of-the-money (OTM) call options and OTM put options with the same expiry. The 25-delta skew specifically compares options that are 25% out of the money.

  • Positive Skew (Call Skew): When OTM calls are more expensive than OTM puts, it indicates a market expectation of significant upside moves.
  • Negative Skew (Put Skew): When OTM puts are more expensive than OTM calls, it suggests the market is pricing in a higher probability of downside risk, often due to demand for downside protection. This is referred to as "put asymmetry" or "put territory."

Glassnode highlighted the divergence between near-term and longer-term skew, which provides a vivid picture of the market's conviction horizons.

Put/Call Ratio

The put/call ratio is a sentiment indicator calculated by dividing the total number of traded put options by the total number of traded call options.

  • High Ratio (>1): More puts being traded than calls, indicating a bearish sentiment or increased demand for downside protection.
  • Low Ratio (<1): More calls being traded than puts, indicating a bullish sentiment.

Glassnode noted a sharp drop in this ratio, signaling a surge in call activity, but cautioned against misinterpreting this as broad conviction.

The Near-Term Skew Shift: A Fleeting Glimpse of Bullishness

Around mid-January, as Bitcoin rallied approximately 8% over a few days, the derivatives market showed an immediate, positive reaction. Glassnode pointed out that the 1-week 25-delta skew shifted dramatically towards neutral from "deep put territory." This phenomenon, where near-dated put options become relatively less expensive compared to calls, typically signals a reduction in immediate downside fears and a budding bullish outlook for the very short term. For many observers, this front-end shift might have been interpreted as a clear signal of the market "flipping bullish."

However, as Glassnode prudently warned, such near-dated call demand can often be "misread as directional conviction." The transient nature of these short-term shifts means they can quickly reverse or fail to gain traction if not supported by broader market dynamics. The key, as the analytics firm articulated, lies in examining whether this repricing extends further out the curve into longer expiry contracts. Without that wider repricing, the immediate bullishness remains isolated, a tactical play rather than a foundational change in market outlook.

The Illusion of Call Demand: Volume vs. Conviction

Further supporting the notion of tactical positioning, Glassnode presented flow data indicating a significant surge in call option activity. The options volume put/call ratio plummeted from 1 to 0.4, a clear sign that a substantially higher number of call options were being bought relative to put options. On the surface, this might appear to be an unequivocal bullish signal—a stampede into upside bets.

Yet, Glassnode's more granular analysis urged caution. The critical question, they framed, was not simply *if* calls were bought, but *how short-dated* that demand actually was. If the surge in call buying was predominantly concentrated in contracts expiring within a week or two, it suggests traders were capitalizing on immediate price momentum or seeking short-term exposure, rather than committing to a sustained, longer-term bullish thesis. This distinction is crucial for differentiating between speculative fervor and genuine market conviction. For insights into understanding speculative flows in broader markets, you might find valuable resources at tooweeks.blogspot.com.

The Anchored Long-Dated Picture: No Conviction Across Maturities

The true litmus test for market conviction, according to Glassnode, lies in the behavior of longer-dated options. Here, the picture was notably less enthusiastic and directly contradicted the near-term bullishness. While the 1-week 25-delta skew plunged from 8% to 1% (moving towards neutral), the 1-month 25-delta skew told a different story. It only nudged from 7% to 4% "at the low," crucially remaining in "put asymmetry." This means that even with Bitcoin's rally, the market continued to demand relatively more expensive downside protection for options expiring a month out.

The divergence became even more pronounced when examining the 3-month 25-delta skew. This metric saw an even smaller shift (less than 1.5%) and "stayed firmly in put territory," steadfastly continuing to price asymmetric downside risk. This persistent put asymmetry in longer-dated contracts is a powerful indicator. It signifies that despite the spot price appreciation and the burst of short-term call buying, institutional players and longer-term traders were not meaningfully repricing their expectations for significant, sustained upside in the medium term. They were either maintaining their hedges or not extending their bullish bets beyond the very immediate horizon.

The Volatility Tape's Verdict: Gamma Sellers and Tactical Positioning

Adding another layer to Glassnode's skeptical outlook was the behavior of the implied volatility (IV) tape. Implied volatility, as discussed, is the market's expectation of future price swings. Typically, in a genuine breakout accompanied by strong conviction, implied volatility tends to get "bid" – meaning options prices rise as traders anticipate larger moves and are willing to pay more for optionality. However, Glassnode observed the opposite: "vol being sold as price moved higher."

This phenomenon suggests that "gamma sellers" were monetizing the rally. Gamma sellers are often market makers or sophisticated traders who sell options, profiting from the premium as long as the underlying asset stays within a certain range or moves in a predictable manner, or they are able to hedge their positions efficiently. When implied volatility is sold during a rally, it implies a belief that the rally may not be sustained, or that the magnitude of future price moves will not justify higher option premiums. This behavior is distinctly "not the volatility behavior typically associated with sustained breakouts." Instead, it aligns with tactical positioning, where participants are reacting to immediate price action rather than building positions based on a belief in a durable new price regime.

The Critical Divergence: Flow vs. Risk Pricing

For Glassnode, the most significant takeaway from their analysis was the clear divergence between "flow" and "risk pricing."

  • Flow: Refers to the actual volume and direction of trades—the buying of short-dated calls, the reduction in the put/call ratio. This represents immediate market action and sentiment.
  • Risk Pricing: Refers to how the market is structurally pricing future probabilities of upside or downside, reflected in longer-dated skew and implied volatility. This reveals deeper, more ingrained market expectations.

Upside participation through call buying was undoubtedly real, contributing to the immediate price momentum. However, the crucial point is that this flow did not "meaningfully change how the market priced risk further out the curve." If traders were truly extending their optimism into a "higher-conviction, longer-horizon view," we would have seen a consistent repricing of skew across all maturities, with a reduction in put asymmetry even in the longer-dated options, and implied volatility being bid up across the board. The absence of this coordinated shift suggests a more cautious, wait-and-see approach from the broader options market, indicating that the rally lacked the underlying structural support for a sustained, high-conviction move.

Implications for Bitcoin Traders and Market Vulnerability

This tactical positioning, characterized by front-end call demand coupled with implied volatility supply, carries significant implications for Bitcoin traders. If the market's conviction is primarily short-dated, it means that the rally is more vulnerable to a lack of follow-through buying. Once these short-dated options structures roll off, or if their holders take profits, the underlying spot market could lose its support without new, longer-term conviction stepping in.

Such a scenario can lead to rapid price corrections or consolidation, as the temporary tailwind from short-term bullish bets dissipates. For individual traders, this highlights the importance of looking beyond immediate price action and superficial indicators. A deeper understanding of derivatives behavior, as articulated by Glassnode, provides a more robust framework for assessing market health and potential future moves. For more general advice on navigating volatile markets, consider reviewing insights available at tooweeks.blogspot.com.

Glassnode's Checklist for a "Cleaner Breakout"

To help traders distinguish between tactical bounces and genuine, sustainable breakouts, Glassnode concluded their analysis with a clear checklist. An "ideal breakout setup" for Bitcoin, one that signals true market conviction and potential for sustained upward movement, would feature the following conditions:

  1. Spot Pressing Key Levels: The underlying Bitcoin price (spot market) should be testing and breaching significant resistance levels with strength.
  2. Skew Pointing Higher with Conviction Across Maturities: The options skew, particularly the 25-delta skew, should not only show bullishness in the near term but also shift meaningfully out of put asymmetry across 1-month, 3-month, and even longer-dated expiries. This signifies broad market agreement on upside potential.
  3. Volatility Being Bid: Implied volatility should be rising, not falling, as the price moves higher. This indicates that traders are willing to pay more for options, anticipating larger future price swings and signaling strong belief in the rally's continuation.

Glassnode's clear assessment was that "Last week’s move didn’t meet those conditions." This serves as a vital warning sign for those who might have become overly optimistic about Bitcoin's immediate prospects based solely on the spot price action.

Monitoring for Future Conviction: What to Watch

Given Glassnode's detailed analysis, the implication for traders watching whether BTC can truly revisit and sustain levels around $97,600 is straightforward. The focus must shift from fleeting short-term signals to more enduring, structural shifts in the options market. Specifically, traders should diligently monitor:

  • Longer-Dated Skew: Observe whether the 1-month and 3-month 25-delta skew metrics begin to consistently lift out of put territory and move towards neutral or even call asymmetry. This would indicate a broader repricing of upside risk.
  • Implied Volatility Behavior: Watch for implied volatility to start getting "bid" (i.e., rising premiums), rather than being sold, as the spot price tests key resistance levels again. This signals a market expectation of more significant, sustained price movement.

Until these conditions manifest, any retest of $97,600, or indeed any significant upward movement, should be viewed through a lens of caution, understanding that it might be driven by tactical plays rather than robust, widespread conviction. Keep an eye on market sentiment indicators and overall economic trends for a complete picture; tooweeks.blogspot.com often provides relevant macroeconomic contexts.

Conclusion: Navigating Bitcoin's Path to $97,600

Bitcoin's journey to $97,600, while exciting, has been expertly dissected by Glassnode, revealing critical nuances in the derivatives market. The surge in front-end call demand was undeniable, but the lack of corresponding conviction in longer-dated options skew and the selling of implied volatility painted a picture of tactical positioning rather than a profound shift in market sentiment. For a truly sustainable breakout, the options market must show broad-based conviction across all maturities, with risk pricing aligning with upside potential and volatility being bid up.

As Bitcoin currently trades around $89,297 at press time, the path back to and above $97,600 will require more than just spot price momentum. It demands a visible change in the structural behavior of the options market, signaling a collective belief in sustained upside. Traders equipped with this deeper understanding can make more informed decisions, differentiating between speculative froth and genuine, high-conviction moves in the ever-evolving cryptocurrency landscape. The vigilance over longer-dated skew and implied volatility will be key indicators in confirming whether Bitcoin is truly poised for a higher trajectory or merely experiencing another short-lived burst of optimism.

💡 Frequently Asked Questions

Q1: Why was Glassnode skeptical of Bitcoin's $97,600 rally?

A1: Glassnode was skeptical because while there was a burst of short-dated bullish options activity (call demand), this sentiment didn't translate into broader, longer-term market conviction. Longer-dated options skew remained anchored in downside protection (put asymmetry), and implied volatility was sold, indicating tactical positioning rather than a sustained bullish outlook.



Q2: What is "options skew" and why is it important?

A2: Options skew (specifically 25-delta skew) measures the difference in implied volatility between out-of-the-money call and put options. It's important because it reveals how the market is pricing future probabilities of upside versus downside. A "put asymmetry" (negative skew) indicates the market is demanding more for downside protection, suggesting a belief in higher probability of downside risk.



Q3: What did Glassnode observe about short-term versus long-term options activity?

A3: Glassnode noted a sharp shift in near-term (1-week) options skew towards neutral, signaling short-term bullishness and a surge in call buying. However, longer-dated (1-month, 3-month) options skew remained "firmly in put territory," showing little change and continued pricing of asymmetric downside. This divergence suggested short-term flow without long-term risk repricing.



Q4: How did implied volatility behave during the rally, and what does it signify?

A4: During Bitcoin's rally, Glassnode observed that implied volatility was "sold as price moved higher." This signifies that "gamma sellers" were monetizing the rally, which is not typical behavior for sustained breakouts. In a true breakout, implied volatility usually gets "bid" (rises), as traders anticipate larger future price swings.



Q5: What conditions would Glassnode consider for a "cleaner breakout" for Bitcoin?

A5: Glassnode's checklist for a cleaner breakout includes: spot price pressing key levels, options skew pointing higher with conviction across all maturities (not just short-term), and implied volatility being bid (rising), not sold, as the price moves up. The recent rally did not meet these conditions.

#BitcoinOptions #Glassnode #CryptoAnalysis #BTCPrice #OptionsTrading

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