Bulls are in profit as Bitcoin prices rise for Friday’s $1.2B BTC options expiry

Bitcoin’s rise to $69,000 caught bears off guard and cemented bulls expecting $400 million profit Friday’s $1.2 Billion options expiry.
Excessive expectations are set every time a new Bitcoin record (BTC) is reached. It was no different this time, as its price briefly touched $69,000 in early November. Bitcoin 8h, the historical correction that we received on November 9th, seems to be minor for now. Naturally I expect at bigger correction after we hit the 84k region, and then into blast off.$BTC #Crypto #Bitcoin pic.twitter.com/cfbBkOIFEK– Miles J Creative (@JohalMiles) November 9, 2021

Words are just words. You can’t lose being too bullish or bearish. However, in options markets, there is a cost to place those bets. On Nov. 10, a right is granted to buy Bitcoin (call option), at $100,000 on December 31st. The price of Bitcoin 0.022, or $1.460, is quoted at BTC 0.022. The upfront fee is known as the premium. This means that the investor must pay a $1000.00 fee to be able to buy Bitcoin (call option) at $100,000 on Dec. 31. Bitcoin currently trades at BTC 0.022, or $1,460. History has shown that short-term price estimates rarely work. It doesn’t matter if the investor is a anonymous Twitter user or a multi-million-dollar crypto fund manager. Even though Tim Draper is a well-known venture capital investor, his $250,000 price estimate for 2020 was 88% off. Even the most renowned bank analysts can make mistakes. A Citibank FX Wire “Market Commentary”, Nov. 2020, stated that a potential $318,000 high for 2021. With 50 days until year-end, some prophecies may prove true, but most are just random numbers. For example, a Citibank FX Wire “Market Commentary” from Nov. 2020 cited a potential $318,000 high in 2021. Huobi Global announced Tuesday that it would close all accounts of Singapore-based users by March 2022. Huobi Global announced Tuesday that it would close all accounts of Singapore-based users by March 2022. Source: BybtAt first glance, the $630m call (buy) options dominate weekly expiry by only 12%, compared to the $565m puts (sell), instruments. However, the 1.12 call/put ratio is misleading because most bearish bets will likely be wiped out by the recent rally. If Bitcoin’s price is above $66,000 at 8:00 UTC on Nov. 12, then virtually all put (sell) instruments will be worthless. If Bitcoin is trading above $62,000, it has no value. Bulls may aim for a profit of $410 million. Below are the most likely scenarios for the Nov. 12 expiry. The theoretical profit is determined by the imbalance favoring one side. The theoretical profit is the difference in the active quantity of put (buy) or call (sell) contracts depending on the expiry prices: Between $64,000 and $66,000, there are 2,440 calls and 310 puts. The net result favors the call (bull), which is $135 million. Between $66,000 and $68,000, there are 3,430 calls and 50 puts. The net result favors the call (bull), instruments. Between $68,000 and $70,000, 44,070 calls vs. ten puts. The net result is $305,000,000 favoring the call bull instruments. Above $70,000: 5,820 called vs. 0. The net result is total dominance with bulls taking $410 million. This simplifies complex investment strategies. For example, a trader might have sold a put option to gain exposure to Bitcoin above a certain price. It’s difficult to quantify this effect. The bears’ best hopes were futile after a 19% rally over 30 days. Bulls now dominate the weekly expiry of Nov. 12. The absence of any adverse price impact following passage of the $1 trillion U.S. Infrastructure bill by the United States House of Representatives may have been a factor in that move. The bill requires that all digital asset transactions exceeding $10,000 be reported to the IRS. Traders should remember that bearish news can have little or no effect on the price during bull run. The effort required by bears to push the price down is usually increased and ineffective. Bulls could take advantage of the current situation and push BTC above $70,000 to increase their estimated profit, which would bring their total to $410million. Risk is inherent in every investment and trading move. Before making a decision, you should do your own research.

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