The number of active Bitcoin call contracts is significantly higher than puts, indicating bullish market sentiment.
- Bitcoin rebound Crypto spurs demand for out-of-the-money calls at strikes from $70,000 to $100,000.
- Analysts said the path of least resistance for Bitcoin is higher.
The recent price spike in Bitcoin (BTC) has options traders rethinking the chances of the cryptocurrency reaching $100,000 this year. According to data built by CoinDesk, the market value of the top cryptocurrency rose by over 12% to $63,470 after Federal Reserve Chairman Jerome Powell said last Wednesday that additional tightening or rate hikes would not be the next policy step. U.S. nonfarm payrolls (NFP) data that was dismal on Friday confirmed Powell’s stance, which sped up Bitcoin’s rebound.
Because of this, demand for bitcoin call options on OTC networks and the market leader Deribit has skyrocketed. These options aim squarely at a surge to new heights, maybe going above $75,000 or $100,000. Following Friday’s reverse rally and continuing into the weekend, we are witnessing some bullish follow-through in volatility and rates. QCP Capital stated in a report on Monday that there has been a resurgence in demand for Bitcoin (BTC) September expiry of $75,000 and $100,000 calls. The risk reversals for the cryptocurrency have turned positive, meaning that calls are more expensive than puts.
The right to buy an underlying asset at a specific price and on or before a particular date is granted by a call option. There is an underlying bullish bias among call option purchasers and a bearish bias among put option purchasers. The market for institutional bitcoin trading over-the-counter Similarly, Paradigm noted on Monday that there was a rise in the demand for out-of-the-money (OTM) calls, with strikes significantly higher than the current bitcoin market price.
The options market forecasts a short-term surge higher since the top Bitcoin and Ethereum deals on Paradigm this morning were large-scale out-of-the-money calls. Paradigm identified a buyer of the March 25 [expiry] $200,000 calls in a Telegram broadcast. The buyer had already closed their position to purchase the July 2024 [expiry] $85,000 strike. The $100,000 strike call options with different maturities have received almost $688 million in commitments from traders, according to statistics from Deribit. It has the most open interest among all options available on the exchange.
Deribit had over 150,000 open call option contracts with a combined value of $9.5 billion as of this writing. An indication of optimistic market predictions, it’s more than double the open interest in put options. The amount of money held in the number of open contracts is known as the notional open interest. On Deribit, one option contract stands for every Bitcoin (BTC) or Ethereum (ETH) token.
Analysts bullish on BTC Bitcoin Rebound Crypto
Once again, Bitcoin’s fundamental and technical analysts have come together to support the assumption that the cryptocurrency’s price is most likely to continue rising. The U.S. election cycle and the continuation of deficit spending support Bitcoin. 10X Research’s May 3 study found that the market might potentially trade (tactically) above 62,000, thus lowering their “line in the sand” from 68,300 to that level.
Siwssblock Insights predicts a defensive dollar index (DXY) until Powell’s attitude is opposed. Weaker DXYs help risky assets like cryptocurrency. Since Wednesday’s Fed meeting, the DXY has fallen 1.2% to 105.20. If Powell’s economic data is correct, the dollar should fall. Swissblock Insights’ newest letter predicts a weaker job situation may hurt the dollar. Hawkish Fed members may favor higher rates for a while. Bitcoins could hit 92,000, according to Ledn’s head investment manager John Glover’s Elliot wave analysis.
As you can see in the chart below, “The BTC price bitcoin” is still following my predicted Wave 4 trajectory. Glover told CoinDesk in an email that while the drop to $56.5k may have ended the correction, he still anticipates a price between $52–55k before Wave 4 finishes. Once Wave 4 ends, he predicts a push to around $92,000. In 1938, Ralph Nelson Elliott published T”the Wave Principle, which introduced the Elliot wave theory. Predicting an item’s future worth via its periodic wave pattern is the main idea behind the theory. Trends consist of five waves; impulse waves 1, 3, and 5 are the most important, while waves 2 and 4 are only temporary retracements.
Impact on Crypto Options Traders Bitcoin Rebound
Cryptocurrency options traders have shown a heightened interest in the possibility of Bitcoin reaching $100,000. These traders view this as a chance to capitalize on potential price changes. Options contracts offer traders the flexibility to profit from price movements in both the upward and downward direction, which makes them an attractive product in volatile markets.
Conclusion
Thanks to Bitcoin’s recent price rebound, crypto enthusiasts are feeling optimistic again. Many are predicting a jump towards $100,000. Crypto options traders are getting more active due to this positive mindset, testing different tactics to profit from possible price moves. Because of the inherent dangers of options trading in highly unpredictable markets, traders must proceed with extreme care and attention.
