BTC to 90K?! You Won’t BELIEVE What Happens Next! 😱

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It has come to my attention that those who dabble in Bitcoin, a most curious digital currency, are bracing themselves for the expiry of options valued at no less than $16.5 billion! A sum, I daresay, that would make even Mr. Darcy raise an eyebrow. However, rumours abound that the impact on the market will be less pronounced than anticipated, as Bitcoin’s rather ungainly tumble below $90,000 has left many a bullish investor feeling quite like a goose in a thunderstorm. 😒

This unfortunate turn of events presents a golden opportunity for those bearish souls to escape a potential loss of some $3 billion, a situation that could, in its own way, exert a considerable influence over the market dynamics in the weeks to come. One might almost feel sorry for them…almost.

At present, the total open interest for call (buy) options stands at a respectable $10.5 billion, while the put (sell) options lag behind at a mere $6 billion. But alas! $7.6 billion of these calls are set at $92,000 or higher, meaning Bitcoin would need a rather spirited 6.4% ascent from its current price to render them viable by the 28th of March. As a consequence, the advantage for those bullish bets has diminished considerably. A sad state of affairs, indeed.

Bitcoin bulls pray for a “decoupling” if QE restarts

Certain analysts, with their heads buried deep in economic treatises, attribute Bitcoin’s less than stellar performance to the ongoing global tariff war and those dreadful US government spending cuts, which, they claim, increase the risk of an economic recession. Traders, ever a nervous lot, fret about slower growth, particularly in the artificial intelligence sector, which had propelled the S&P 500 to a record high on the 19th of February before suffering a most unfortunate 7% decline. Oh, the drama! 🎭

Meanwhile, Bitcoin bulls, bless their optimistic hearts, remain hopeful for a decoupling from the stock market, despite the 40-day correlation remaining stubbornly above 70% since the beginning of March. Their optimism, it seems, stems from the expansion of the monetary base by central banks and an increased adoption of Bitcoin by companies such as GameStop (GME), Rumble (RUM), Metaplanet (TYO:3350), and Semler Scientific (SMLR). One can only hope their faith is not misplaced.

As the options expiry date draws ever closer, both bulls and bears have a rather strong incentive to influence Bitcoin’s spot price. However, while bullish investors aspire to levels above $92,000, their optimism alone is hardly sufficient to guarantee that BTC will surpass this mark. Deribit, it appears, leads the options market with a 74% share, followed by the Chicago Mercantile Exchange (CME) at 8.5% and Binance at 8%. A veritable hierarchy of financial influence! 🤔

Given the current state of affairs, Bitcoin bulls hold a strategic advantage as they head into the monthly options expiry. For instance, should Bitcoin remain at $86,500 by 8:00 am UTC on the 28th of March, a mere $2 billion worth of put (sell) options will be in play. This situation, naturally, incentivizes those bearish individuals to drive Bitcoin below $84,000, a move that would increase the value of active put options to $2.6 billion. Such machinations!

Bitcoin bulls will have the edge if BTC price passes $90,000

Below, one finds five probable scenarios based on current price trends. These outcomes estimate theoretical profits based on open interest imbalances but, alas, exclude more complex strategies, such as selling put options to gain upside price exposure. A pity, perhaps, for those who enjoy a good gamble. 😉

  • Between $81,000 and $85,000: $2.7 billion in calls (buy) vs. $2.6 billion in puts (sell). The net result favors the call instruments by $100 million.

  • Between $85,000 and $88,000: $3.3 billion calls vs. $2 billion puts, favoring calls by $1.3 billion.

  • Between $88,000 and $90,000: $3.4 billion calls vs. $1.8 billion puts, favoring calls by $1.6 billion.

  • Between $90,000 and $92,000: $4.4 billion calls vs. $1.4 billion puts, favoring calls by $3 billion.

To minimize their losses, the bears must, of necessity, push Bitcoin below $84,000—a 3% drop—before the 28th of March. This move would increase the value of put (sell) options, thereby strengthening their position. A desperate gambit, to be sure!

Conversely, the bulls can maximize their gains by driving BTC above $90,000, a feat which could create sufficient momentum to establish a bullish trend for April, especially if inflows into spot Bitcoin exchange-traded funds (ETFs) resume at a strong pace. One can only speculate, of course. 🤷‍♀️

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of CryptoMoon. As if I needed to state the obvious!

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2025-03-27 22:30