Options Data Shows Bitcoin's Short-Term Uptrend Is Threatened If BTC Falls Below $23,000
BTC's $335 million options expiration has become a death trap for bulls, and rising lawsuits from the SEC and IRS against crypto companies adds to the selling pressure.
Market analysis
Bitcoin (BTC) briefly breached the $25,000 mark on August 15, but the excitement lasted less than an hour and was followed by a 5% pullback over the next five hours. The resistance level proved more difficult than expected, but may have given bulls false hope for the upcoming weekly $335 million options expiry.
Ephemeral investor optimism returned to a seller's market on August 17 after BTC gave up and tested the $23,300 support. The negative move came hours before the release of the Federal Open Markets Committee (FOMC) minutes from its July meeting. Investors expect to know if the Federal Reserve will continue to raise interest rates.
The negative news flow accelerated on August 16 after a U.S. federal court allowed the U.S. Internal Revenue Service (IRS) to force cryptocurrency broker SFOX to disclose transactions and the identity of customers who are US taxpayers. The same strategy was used to obtain information from Circle, Coinbase and Kraken between 2018 and 2021.
This move explains why betting Bitcoin price above $25,000 on August 19 seemed like a sure thing a few days ago, and it would have prompted bullish betting.
Bears did not expect BTC to break above $24,000Open interest for the August 19 options expiry is $335 million, but the actual figure will be lower as the bears were too bullish. These traders may have been fooled by the short-lived dump at $22,700 on August 10, as their bets for the August options expiration extend up to $15,000.
BTC's $335 million options expiration has become a death trap for bulls, and rising lawsuits from the SEC and IRS against crypto companies adds to the selling pressure.
Market analysis
Bitcoin (BTC) briefly breached the $25,000 mark on August 15, but the excitement lasted less than an hour and was followed by a 5% pullback over the next five hours. The resistance level proved more difficult than expected, but may have given bulls false hope for the upcoming weekly $335 million options expiry.
Ephemeral investor optimism returned to a seller's market on August 17 after BTC gave up and tested the $23,300 support. The negative move came hours before the release of the Federal Open Markets Committee (FOMC) minutes from its July meeting. Investors expect to know if the Federal Reserve will continue to raise interest rates.
The negative news flow accelerated on August 16 after a U.S. federal court allowed the U.S. Internal Revenue Service (IRS) to force cryptocurrency broker SFOX to disclose transactions and the identity of customers who are US taxpayers. The same strategy was used to obtain information from Circle, Coinbase and Kraken between 2018 and 2021.
This move explains why betting Bitcoin price above $25,000 on August 19 seemed like a sure thing a few days ago, and it would have prompted bullish betting.
Bears did not expect BTC to break above $24,000Open interest for the August 19 options expiry is $335 million, but the actual figure will be lower as the bears were too bullish. These traders may have been fooled by the short-lived dump at $22,700 on August 10, as their bets for the August options expiration extend up to $15,000.
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