Will Bitcoin continue to fall? Two major price indicators show that Bitcoin has not yet bottomed out

Has the Bitcoin price hit bottom? Derivatives and on-chain data suggest further downside could be brewing.

Since Bitcoin’s pullback to $30,000 on May 12, traders have been struggling to time a trend reversal, with the community beginning to look everywhere for signs of a trend reversal, including technical patterns, U.S. CPI inflation data, and Bitcoin exchange deposits.

However, two days later, Bitcoin managed to break through $40,000, but the move lasted less than six hours. Meanwhile, other traders deduced that a retest of the $30,000 bottom was needed before a rebound could be made.

Delta Skew call options allow buyers to buy Bitcoin at a fixed price when the contract expires. On the other hand, put options provide buyers with insurance against falling prices.
Whenever market makers and professional traders are bullish, they demand higher premiums for call (buy) options. This trend will result in a negative 25% delta skew indicator. On the other hand, if downside protection costs more, the skew indicator will turn positive.

A 25% delta skew that oscillates between negative 10% and positive 10% is generally considered neutral. This equilibrium situation persisted until May 16, when Bitcoin failed to hold the critical support level of $47,000, which had held for 76 days.
As the market oscillates, the 25% delta skew indicator is also deteriorating, and the cost of protective options has soared. Therefore, it seems too early to call a market bottom until the indicator establishes a neutral pattern closer to the 5% level.
Active Bitcoin Supply Traders also focus on the number of Bitcoin supplies that have been active recently. This metric cannot be considered bullish or bearish on its own because it does not provide information about how long addresses have been holding Bitcoin.
Since October 1, 2020, the price of Bitcoin has risen 500%, peaking at $64,900 on April 14, 2021, causing a significant increase in supply in the months leading up to the rise. When this indicator shows a significant drop, it indicates that investors are no longer interested in participating at current price levels.

In the past 30 days, there were 2.2 million BTC active, which is significantly higher than the levels before October 2020.
As things stand, traders should not assume that Bitcoin has bottomed.