Short Squeeze

In this week's Crypto Insight I discussed...

The recent strong rally from 29k which triggered a short squeeze and has taken BTC all the way back up to 40k in a few days.

With rumours of Amazon adoption of BTC (which have been denied) being the catalyst to start the move, we saw the perpetual futures funding rates also signalling a decent short base.

Tether headlines have also been on BLOOMBERG as reports of their DOJ investigation into bank fraud reach the mainstream media.

Volatility markets however have been quite orderly on the move up, as implied vols had been trading at a premium already and so didn’t need to rally much. Skew has moved towards calls as some clients scrambled to buy short dated calls in 30Jul and 6Aug expiry to play the break higher. Finally, expiry this Friday will likely be contained by the 35/40k range as that is where a decent amount of the open interest resides, assuming no big news flow.

Filmed on on Tuesday 27th July 2021.

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