Bulls and bears battle it out for the $ 34,000 bitcoin price as the options expire at $ 445 million


Bitcoin (BTC) has hovered between $ 30,400 and $ 36,400 in the past 12 days, and it has been difficult to pinpoint the exact reason for investors’ lack of appetite. Some analysts have pointed out that the Grayscale Bitcoin Trust (GBTC) went live in mid-July, finally giving institutional investors a chance to sell their funds, but that’s probably not the main reason.

Meanwhile, industry leaders have suggested that the emerging US “cryptoregulatory crackdown” is heavily influencing investor sentiment, and this view is particularly problematic considering that China recently banned all crypto-mining activities in the country.

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After all, renowned Bitcoin critics, including Aswath Damodaran, finance professor at New York University’s Stern School of Business, have claimed that the cryptocurrency “failed miserably” as a currency.

Damodaran explicitly cites the limited use of Bitcoin in microtransactions, despite the fact that El Salvador is pushing a plan to democratize the Lightning Network solution.

Bulls have a better chance of winning the weekly schedule

After the bears won a recent quarterly expiry of $ 3 billion options on Friday, the wind may have shifted the tide favorably in favor of the bulls this time around. While the $ 34,000 level last week offered a $ 310 million advantage on the neutral to bearish put options, upcoming Friday, July 2nd, offers an entirely different setup.

Aggregated open interest for Bitcoin options as of July 2nd. Source: Bybt

The initial picture paints a neutral structure, with the neutral to positive call options dominating Open Interest by 8% according to the call-to-put ratio. Of the $ 445 million in open interest, $ 230 million is represented by the neutral to bullish call options, giving the bulls a slight edge. However, looking at more detailed data offers a different perspective.

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Only 18% of the protective put options were placed on a strike of $ 33,000 or higher. Therefore, if Bitcoin trades above this level at 8:00 a.m. UTC on Friday, only these neutral to bearish instruments will hold $ 38 million.

$ 34,000 is the make-or-break level for both sides

On the flip side, the bulls will likely try to defend the $ 34,000 level, resulting in $ 45 million in open positions on call options.

To be honest, both sides have incentives to break that sensible balance at $ 34,000. For example, over $ 35,000, the cops’ advantage increased from $ 7 million to $ 57 million.

Conversely, bears have the upper hand when Bitcoin trades below $ 33,000. In this case, the open positions of the protective put options are $ 31 million higher than those of the neutral to bullish call options.

In summary, it is impossible to predict which side will get stronger on Friday. However, this is the first time in over four weeks that bulls have had a decent fighting chance.

The views and opinions expressed here are solely those of author and do not necessarily reflect the views of Cointelegraph. Every investment and trading movement involves risks. You should do your own research when making a decision.