$600M in Bitcoin Options Expires Friday, Giving Bears Reason to Pin BTC Under $16,000
The bears are better positioned for Friday's $600 million BTC options expiration, but the bulls can reverse the tables if price of Bitcoin exceeds $18,000.
Market analysis
No one can blame the Bitcoin (BTC) bulls for placing bets at $20,000+ for the $600M Weekly Options expiration on Nov. 18. After all, this level had provided strong resistance since October 25 and held for almost two weeks.
However, the baseline scenario changed abruptly on November 8 after a liquidity crunch halted withdrawals on the FTX exchange. The move surprised traders and over a 48-hour period, over $290 million in leveraged buyers were liquidated.
Bitcoin/USD Price Index, 12 Hours chart. Source: TradingViewThe market quickly adapted to the news, ranging from $15,800 to $17,800 in the past seven days. For now, investors are concerned that contagion risks will force other key players to sell their cryptocurrency positions.
FTX held large deposits from key industry players, so its demise meant that other participants would suffer substantial losses as well. For example, BlockFi had a $400 million line of credit with FTX US. On November 15, the guaranteed return platform SALT revealed significant losses due to the collapse of FTX and subsequently halted withdrawals.
Similar events have occurred on Japanese cryptocurrency exchange Liquid, increasing the level of uncertainty across the market as a whole.
The November 18 options expiry is particularly relevant, as Bitcoin bears can profit $120 million by removing BTC below $16,500.
The bulls placed their bets at $20,000 and aboveOpen interest for the November 18 weekly options expiry is $600 million, but the actual figure will be lower as the bulls were too optimistic. These traders missed the mark, placing bearish bets at $18,000+, while BTC was dumped following FTX's insolvency.
The bears are better positioned for Friday's $600 million BTC options expiration, but the bulls can reverse the tables if price of Bitcoin exceeds $18,000.
Market analysis
No one can blame the Bitcoin (BTC) bulls for placing bets at $20,000+ for the $600M Weekly Options expiration on Nov. 18. After all, this level had provided strong resistance since October 25 and held for almost two weeks.
However, the baseline scenario changed abruptly on November 8 after a liquidity crunch halted withdrawals on the FTX exchange. The move surprised traders and over a 48-hour period, over $290 million in leveraged buyers were liquidated.
Bitcoin/USD Price Index, 12 Hours chart. Source: TradingViewThe market quickly adapted to the news, ranging from $15,800 to $17,800 in the past seven days. For now, investors are concerned that contagion risks will force other key players to sell their cryptocurrency positions.
FTX held large deposits from key industry players, so its demise meant that other participants would suffer substantial losses as well. For example, BlockFi had a $400 million line of credit with FTX US. On November 15, the guaranteed return platform SALT revealed significant losses due to the collapse of FTX and subsequently halted withdrawals.
Similar events have occurred on Japanese cryptocurrency exchange Liquid, increasing the level of uncertainty across the market as a whole.
The November 18 options expiry is particularly relevant, as Bitcoin bears can profit $120 million by removing BTC below $16,500.
The bulls placed their bets at $20,000 and aboveOpen interest for the November 18 weekly options expiry is $600 million, but the actual figure will be lower as the bulls were too optimistic. These traders missed the mark, placing bearish bets at $18,000+, while BTC was dumped following FTX's insolvency.
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