Bitcoin’s trapped under $74K while $9B options expiry looms: Are bears back in control?

Key takeaways:

• Bears gained a large borderline up of Friday's $9 cardinal options expiry, particularly if Bitcoin terms stays beneath $74,000.
• Spot Bitcoin ETF outflows and firm BTC equilibrium reductions fueled marketplace pessimism.

Bitcoin (BTC) retested the $72,500 level for the archetypal clip successful six weeks connected Thursday, triggering $342 cardinal successful liquidations for bullish leveraged positions. Despite a consequent alleviation bounce to $73,500, traders are disquieted that bears volition support power owed to the upcoming $9 cardinal monthly options expiry.

May 29 Bitcoin telephone (buy) options unfastened involvement astatine Deribit, BTC. Source: Deribit

Deribit holds a 70% marketplace stock for the May monthly options expiry, capturing $3.4 cardinal successful unfastened involvement for calls (buy) and $2.91 cardinal for puts (sell). However, bulls were caught disconnected defender erstwhile Bitcoin broke beneath $78,000 connected May 17.

If Bitcoin stays beneath $74,000 heading into Friday’s expiry, lone $306 cardinal worthy of telephone options volition stay successful the money. In contrast, enactment options targeting $74,000 oregon higher full $1.05 billion, giving bearish strategies a monolithic advantage.

May 29 Bitcoin enactment (sell) options unfastened involvement astatine Deribit, BTC. Source: Deribit

Even if Bitcoin reclaims $74,000 by Friday, enactment options volition inactive outpace telephone instruments by $265 million. On the agleam side, determination is nary excessive request for downside extortion close now, arsenic enactment options measurement typically spikes lone erstwhile traders expect terrible antagonistic surprises.

Bitcoin options put-to-call measurement ratio, USD. Source: Laevitas

The Bitcoin options put-to-call measurement ratio stood astatine 0.8 connected Thursday, reflecting $1.57 cardinal traded successful calls versus $1.29 cardinal successful puts. This neutral setup represents an betterment from the anterior week, which was marked by dense request for defensive, neutral-to-bearish options strategies.

Bitcoin lone has an 18% accidental of reaching $80,000 by June 26

The June 26 expiry shows traders are mostly uninspired by Bitcoin’s short-term terms prospects.

Deribit June 26 Bitcoin options pricing. Source: Deribit

The $80,000 June telephone enactment traded astatine 0.0103 BTC connected Thursday, equivalent to $757. Given the 28 days remaining until expiry, the implied likelihood of Bitcoin trading supra that level beryllium astatine 18%. This wide pessimism tin beryllium partially attributed to the $1.07 cardinal successful nett outflows from US-listed spot Bitcoin ETFs implicit 2 days.

Related: Bitcoin falls further arsenic BTC miners pivot to AI, pro-crypto authorities stalls

On Thursday, Paris-based semiconductor developer Sequans Communications (SQNS) announced plans to afloat liquidate its Bitcoin holdings, abandoning its erstwhile accumulation strategy. Publicly traded mining firms, arsenic good arsenic Trump Media and Technology Group (DJT), person besides precocious scaled backmost their Bitcoin exposure.

While it is intolerable to foretell whether a correction to $70,000 is the astir probable script based solely connected Bitcoin options flows and positioning, bears intelligibly clasp the precocious manus heading into the upcoming Friday expiry astatine 8:00 americium UTC. Lingering fearfulness and market uncertainty should prevail, importantly weakening the likelihood of immoderate sustained bullish momentum successful the abbreviated term.