The Bitcoin (BTC) market is expected to soon move in a clear direction after a quiet pause. With an unusual silence in the options market, a key diplomatic event in US politics is creating a tense atmosphere for investors. In particular, attention is focused on the potential impact of the summit between President Trump and Russian President Vladimir Putin on the market.
The on-chain data platform glassnode recently released a chart showing a sharp decline in the Bitcoin options volatility index (DVOL) on the Deribit options exchange. DVOL is an indicator measuring implicit (future predictive) volatility, and the current index decline suggests that market participants are not significantly concerned about recent short-term downside risks. Most option traders are not taking downside defensive positions, and an excessive market stability expectation is being detected.
As seen in past cases, this is not unrelated to the phenomenon of sharp price fluctuations occurring immediately after a relatively suppressed volatility phase. Actually, Bitcoin recently broke through its all-time high of $124,450 and is currently slightly adjusted to $119,000. However, its future direction remains unclear. Glassnode pointed out that "such suppressed volatility not reflected in price could be a warning signal that the market is underestimating risks".
Whether Bitcoin will direction towards a short-term surge or sharp decline is likely to be influenced by external factors. At the center of this is the summit between President Trump and President Putin. The two heads of state are scheduled to meet in Alaska today to discuss the possibility of a ceasefire in the Russia-Ukraine war, drawing attention from both Wall Street and the crypto market. Notably, this is also the first time a Russian president has visited Alaska.
In the cryptocurrency market, political events have long been an important variable stimulating Bitcoin prices. The claim that cryptocurrencies would show strength if Trump is re-elected has already been shared among various analysts. Therefore, the result of this US-Russia summit could provide a decisive turning point for market direction.
Currently, Bitcoin is hovering near its all-time high, and if US political and geopolitical news acts as a catalyst, an environment has been created for sharp reactions in both upward and downward directions. The market is at the peak of uncertainty, demanding a cautious but simultaneously careful approach.
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