Bitcoin options expiration – what does this mean for the price?

The open interest (OI) for Bitcoin call options is currently twice as high as that for put options, indicating a largely bullish sentiment in the market. Today, Friday, crypto market enthusiasts will be closely watching the movement of Bitcoin options and monitoring the possible price movements of BTC.

About 18,000 BTC options are expiring soon, with a Put Call Ratio of 0.64 and a Maxpain point at $62,000. This week, expiring BTC contracts represent a notional value of approximately $1.15 billion, slightly less than last week.

Put call ratio and open interest

The Put Call Ratio of 0.64 suggests that more long contracts (calls) will expire compared to short contracts (puts). Additionally, open interest for Bitcoin has risen to $700 million at the strike price of $70,000 and $100,000, clearly indicating that the longs have the upper hand. On the other hand, open interest for put calls has also increased to $360 million. This once again emphasizes the bullish sentiment, as call options give the holder the right to buy the underlying asset at a predetermined price on or before a specific date.

Trading firms such as QCP Capital and Paradigm have seen renewed demand for upside call options. This includes buyers closing their current positions to move to higher strike calls expiring in July and September.

A look at the Implied Volatility (IV) of Bitcoin options

According to data from Greeks.Live the crypto market has experienced a pullback over the past week amid the drop in trading volume. Although there was a decline in outflows from the US Bitcoin ETF, market structure and block trading indicated that prices remained weak.

This downward trend has contributed to declining investor confidence, which is reflected in declining Implied Volatility (IV) over key time frames. Currently, IV levels are slightly below the historical average, which provides some support. However, there is little room for further decline at the moment.

Opportunities in a declining market

“Empirically, May has not been a good month for the market, and there is value in buying some monthly puts now,” Greeks.live notes.

In the last 24 hours, Bitcoin price has recovered from below $61,000 and is currently trading close to $63,000. If BTC price makes a strong breakout above $64,000, we could see $70,000 levels soon.

The current dynamics in the Bitcoin options market suggest strong bullish sentiment, with significantly higher open interest in call options. As investors prepare for potential price movements, it remains crucial to keep an eye on market trends and volatility. With current trends, we may see higher prices in the near future, but caution remains necessary in this volatile market.