Panic in Bitcoin Market Ahead of Core PCE Release

The Bitcoin market appears to be in a state of panic, with derivatives investors paying an outsized premium for protection against declines. This condition often sets the stage for a snap bullish readjustment if driven by the right trigger.

For crypto, that trigger could be the U.S. core personal consumption expenditure (PCE) data due at 8:30 a.m. ET on Thursday. Bitcoin's one-week options skew shows a near 25-point premium for puts relative to calls, a sign of the bias for downside bets.

The core PCE is expected to show a 3.4% year-on-year gain for May, up from 3.3% in April and the highest since late 2023. A softer-than-expected number could trigger a snap adjustment in sentiment, undermining the case for more Fed interest-rate increases.