October 3, 2023

While there is always a reason behind every movement in the market, the latest bearish trend in bitcoin over the past 24 hours appears to be the result of $1.8 billion worth of bitcoin options expiring today. This huge amount of bitcoin is going to expire later today, its impact is expected Significant fluctuations in property prices,

Similar to cryptocurrency futures contracts, ohave options Derivatives that allow traders to buy or sell an asset at a pre-established price at a future date, Bitcoin options are an agreement that allows traders to buy or sell bitcoin at a specified price on a specific expiration date. bitcoin options traders leverage To take speculative positions (i.e., up or down) on the price movement of BTC.

Over $1 billion worth of bitcoin options are about to expire

– Advertisement –

According to reporter Colin Wu, to date, about $1.8 billion Bitcoin will expire in options. This large volume of expired BTC could significantly affect the price movement of bitcoin, for example, with BTC showing a bearish trend over the past 24 hours.

Furthermore, as the Open Interest (OI) is above the 300,000 BTC mark, the highest in history, a definite downside from BTC is likely. has open interest The number of outstanding contracts or commitments in options trading has yet to be decided on an official exchange.

Related Reading: Is Bitcoin Price Building Another Parabolic Rally?

– Advertisement –

Wu notes that the put/call ratio is 0.66 and the biggest pain point is at $22,000, which means there is a good buying and selling position. Overall, a put/call ratio greater than 0.7 indicates that traders are filling more of their put (short) positions than their call (long) positions, which means gearing bearish movement from the market.

See also  The FTX Crisis Brought Investors To Decentralized Exchanges. Here’s Why They Might Leave.

A put option is an option to sell an asset at an agreed upon price on or before a specified date. In contrast, a call option is a contract that allows traders to buy an asset at an agreed upon price on or before a specified date.

Specifically, the put/call ratio is calculated by dividing the total amount of puts traded by the number of call trades. A put/call ratio that reads 1 indicates a balanced number of both callers and putters.

BTC Slips Below $24,000

in the last 24 hours, btc price there has been a sharp decline below $24,000 Decrease 2.2%. More than $10 billion has been slashed from its market cap after falling from $471 billion seen yesterday to $461 billion today.

Related Reading: Bitcoin Price Recovery Could Soon Fade Out If BTC Fails to Surpass $24,500

According to will be ridiculed, the world’s largest crypto options exchange, the last major bitcoin options expiration occurred in late December when around 103,000 contracts were liquidated. Although the volume is relatively lower than what was set to expire today, it resulted in a slight pullback from BTC as it was already down following the FTX crash and Binance FUD (Fear, Uncertainty and Doubt).

BTC price is trending sideways on the 4-hour chart. Source: BTC/USD ON Tradingview.com

However, since BTC has been rallying up more than 40% since the start of the year, there could be significant downside from the asset after today’s BTC options liquidation.

Meanwhile, at the time of writing, B T c traded at $23,889 with a 24-hour trading volume of $39.8 Billion.

Featured image from Unsplash, chart from TradingView.