Bitcoin Dips Below $80K but Options Traders Are Positioning for a Rebound

Bitcoin briefly broke below $80,000 over the past 24 hours, erasing part of a 37% rally built since early April, before recovering to around $80,360. CryptoQuant data show the pullback was driven by internal market mechanics rather than macro deterioration: investors realized profits on 14,600 BTC on May 4 — the largest single-day profit-taking event since December 2025 — while a violent short squeeze liquidated roughly $535 million in short positions between May 4 and May 6, pushing open interest from $26.5 billion to $29.1 billion before cooling back to $26.7 billion.

The options market is reading the dip as temporary. Front-end implied volatility has repriced sharply higher from October 2025 lows, and the 25-delta skew — which briefly showed a 5% put premium — is compressing back toward neutral, signaling that downside hedges are being unwound and upside demand is rebuilding.…