BitcoinBTCThe expiration of the monthly options worth $20 billion is set to take place on June 27. Bitcoin has fallen 1.72% in the last 30 days but traders using options to protect themselves against downside risks were bracing themselves for an even greater decline.
The recent recovery in price may offer bulls an opportunity to consolidate support at $105,000. This level could be decisive for the move toward a brand new high in the weeks ahead.
Open interest in call options (buying) is currently $11.2 billion. This compares to $8.8 for options (selling). Noteworthy, of the $7.1 billion in put options that were sold, over half had strike prices below $101,000. The advantage is now heavily in favour of bullish wagers.
Bitcoin Bears best weapon is increasing uncertainty
Bitcoin is gaining in popularity, according to some market analysts. They attribute this strength to Jerome Powell’s more dovish approach. Powell’s semiannual report, released in September 2017, outlined the Fed’s current outlook. testimony Powell spoke Tuesday to the House Committee on Financial Services. “many paths are possible” Rates of interest, for example “cutting sooner” if inflation remains subdued.
Yahoo Finance reported that Governors Michelle Bowman & Chris Waller of the Fed have said they are expecting rate cuts at this year’s Fed policy meeting in July. Citing recent data, which indicates inflationary pressures being under control, these officials expect a cut to rates as early as next month. Meanwhile, the S&P 500 index has climbed to its highest level in over four months.
Bitcoin bulls consider these recent stock gains to be an early sign that investors who currently hold short-term government securities may switch over in the near future in pursuit of greater returns. This thesis is reinforced as analysts project a modest 5% S&P 500 revenue growth for 2025.
Even if the central banks do not expand their monetary policy, they can still have a positive impact on economic growth. monetary base In the short term, falling yields of fixed income securities could fuel Bitcoin’s momentum. In the run-up to the expiry of options, a bearish scenario that is most likely would need a higher level of uncertainty. drop in hashrate Geopolitical instability such as the rising tensions of the Middle East.
Related: June remains Bitcoin’s danger zone, while S&P 500 eyes summer rally
The Bitcoin Bulls are in the lead if BTC passes $90.000
Five possible scenarios are based upon current prices. This outcome estimates theoretical profits using open interest imbalances. However, it excludes complex strategies like selling put options for upside price exposure.
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The difference between $100,000 and $101,500 The result is balanced with $1.75 billion put options and $1.74billion calls.
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From $101,500 to $102,500 The calls won out by $235 million.
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The difference between $102,500 and $104,500 is: The calls won by $750,000,000 compared with the puts.
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From $104,500 to $106,000 The calls won by $1.41 Billion.
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From $106,000 to $108,000 The calls are $2.84 billion versus $750 millions puts. This is a $2.1 billion advantage for the calls.
Bears need to force Bitcoin down below $101,500 on June 27. This is a 5% drop from its current price of $107,300. The bulls’ position can be strengthened by maintaining the price at or above $106,000. They could also set up a rally in July, especially if the spot Bitcoin is higher than the current $107,300. exchange-traded funds (ETFs) inflows persist.
The article does not provide legal advice or investment recommendations and it is intended for informational purposes only. These are solely the opinions, views and thoughts of the author and may not reflect the opinions and views of Cointelegraph.
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Source: cointelegraph.com
