18,000 Bitcoin Options Expire Today, What’s Next for BTC Price?

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

18,000 Bitcoin options will expire today

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

This week has seen significant inflows into the Bitcoin ETFs, driven by the Meme wave in the United States, which pushed the price of Bitcoin above $65,000. However, the broader cryptocurrency market outside of the Meme phenomenon has shown 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 decline . US Consumer Price Index (CPI) Inflation Report..

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

Long-dated options lean to the bullish side

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

The CF Benchmarks analysis also noted that the relative flatness between long-term puts and calls for Bitcoin options could indicate greater institutional involvement, as these investors are typically less prone to extreme swings in sentiment.

As known, 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 allow traders to capitalize on basic trades. This will also allow them to profit by taking advantage of the difference between futures prices and the spot price of the underlying asset.

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