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Bullish Options Activity Rises After Fed Decision
Following the Federal Reserve’s interest rate cut this week, traders have increased their exposure to bullish Bitcoin options. The most actively traded strike is the $100,000 call expiring on December 26, with more than 18,360 call contracts open versus 2,540 puts, according to data shared Wednesday by analytics firm Laevitas.
Despite this surge in bullish positioning, the structure of these trades suggests a more conservative outlook. Much of the open interest is tied to long call condors and bull call spreads, strategies that benefit from a moderate rise rather than an extended breakout.
Liquidity Measures and Market Temperament
The Fed also confirmed it will begin purchasing roughly $40 billion per month in short-term Treasury bills starting Friday. The central bank described the move as “a technical measure aimed at managing liquidity in the banking system and maintaining firm control over its benchmark interest rate target.”
Across broader market indicators, sentiment remains cautious. While the 25-delta options skew has improved from -8% to -5% in the past two weeks, it is still below zero, illustrating persistent demand for downside protection.
CryptoQuant, in a Wednesday report, noted that any relief rally in the near term appears capped at around $99,000.
Bitcoin Slips as Year-End Liquidity Thins
Bitcoin traded near $89,500 at the time of writing—down 2.4% over the past 24 hours and about 5.5% below its post-Fed intraday high of $94,267, according to CoinGecko.
Holiday-period liquidity is playing a major role in the pullback.
“With Christmas and year-end settlement approaching, this period historically marks the weakest liquidity conditions in crypto,” said Adam Chu, chief researcher at GreeksLive, speaking to Decrypt. “Market activity tends to be subdued, limiting the near-term momentum for any sustained rally.”
Chu added that declining implied volatility signals lower expectations for near-term price swings, further reducing the likelihood of a traditional Santa rally.
Traders Shift Bullish Conviction Toward Early 2026
More significant optimism appears concentrated in next year’s first quarter.
“The chance of Bitcoin reclaiming and settling above $100,000 by Christmas now sits at around 24%,” said Sean Dawson, head of research at Derive.
Dawson also pointed to heavy accumulation of March call options at the $130,000 and $180,000 strikes, noting:
“Bulls are levering up for an explosive Q1.”
