18,000 Bitcoin Options Set to Expire Today, What’s Ahead for BTC Price?

Bhushan Akolkar
May 17, 2024
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96000 BTC Options Expiry Sets Max Pain Price At $61,000, What's Next?

Highlights

  • $1.2 billion worth of Bitcoin options are set to expire with a Put Call Ratio of 0.63 and max pain points of $63,000.
  • The derivatives data show that puts are willing to pay the premium suggesting short-term downside.
  • Investors continue to remain optimistic about Bitcoin's long-term prospects.

Earlier this week, the Bitcoin price gave a strong breakout all the way to $66,000 setting up the stage for a surge to new all-time highs. However, the derivatives data for Bitcoin options shows that there could be a short-term correction in BTC before resuming the uptrend.

18,000 Bitcoin Options Set to Expire Today

Greeks.Live reports that 18,000 Bitcoin options are approaching expiration, featuring a Put Call Ratio of 0.63 and a Max Pain point of $63,000, with a total notional value of $1.2 billion.

This week saw significant inflows into the Bitcoin ETFs, driven by the Meme wave in the U.S., which propelled Bitcoin’s price above $65,000. However, the broader crypto market outside of the Meme phenomenon showed signs of weakness, with trading volumes continuing to decline. This trend is reflected in the divergence between Bitcoin and Ethereum options data.

On the other hand, CF Benchmarks’ analysis of Bitcoin (BTC) futures options traded on the Chicago Mercantile Exchange (CME) shows that investors continue to pay a premium for short-term downside protection, despite yesterday’s softer U.S. Consumer Price Index (CPI) inflation report.

According to CF Benchmarks analysts, Bitcoin saw a breakout above $66,000 following the inflation data release. However, higher implied volatility for out-of-the-money (OTM) put options compared to calls suggests that derivatives traders are paying elevated premiums for OTM puts. This indicates a bearish short-term market sentiment, with traders hedging against a potential decline in Bitcoin’s value.

Long-Dated Options Tilt Towards the Bullish Side

In contrast to the short-term outlook, analysts noted a “flatter” volatility curve for longer-dated puts and calls, with a slight skew towards calls. This suggests that investors are more optimistic about Bitcoin’s long-term prospects. It will be interesting to see if this skew towards calls increases if disinflation expectations rise following the favorable CPI report.

CF Benchmarks’ analysis also observed that the relative flatness between longer-dated puts and calls for Bitcoin options might indicate increased institutional involvement, as these investors are typically less prone to extreme swings in sentiment.

As know, the Bitcoin futures trading platform CME Group is willing to provide spot trading to its users. The launch of Bitcoin spot trading on the CME would enable traders to capitalize on basis trades. This will also allow them to profit by exploiting the difference between futures prices and the underlying asset’s spot price.

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Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.

Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
Bhushan is a seasoned crypto writer with over eight years of experience spanning more than 10,000 contributions across multiple platforms like CoinGape, CoinSpeaker, Bitcoinist, Crypto News Flash, and others. Being a Fintech enthusiast, he loves reporting across Crypto, Blockchain, DeFi, Global Macros with a keen understanding in financial markets. 

He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills. Bhushan has a bachelors degree in electronics engineering, however, his interest in finance and economics drives him to crypto and blockchain.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.