👀 Ever bought an option, got the direction right... and still wondered why the trade barely worked? The IV term structure shows how implied volatility changes across different expiration dates: Think of each expiry as having its own price tag for uncertainty. Short-dated IV above longer-dated IV? The market is charging more for movement in the next few days. Longer-dated IV above short-dated IV? More uncertainty is being priced further out. A nearly flat curve? No single expiry is carrying a much bigger volatility premium. With $BTC options, direction is only one part of the trade.
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