Bitcoin, the largest cryptocurrency by market capitalization, has been on a strong upward trajectory since the beginning of the year and reached an all-time high of over $58,000 on February 21st. Nonetheless, the rally looks to be slowing down as Bitcoin has hit resistance at its $52k level and fell below $51k on the 20th of February.
According to cryptocurrency trader and analyst Michael van de Poppe, Bitcoin will continue its bullish run mainly, but he also expects some flushing liquidity before any up continuation. He said that he believes Ethereum will see strong price performance in the days to come, notably until the Dencun upgrade.
On the other hand, Crypto Rover, a prominent crypto analyst, said that Bitcoin is poised for a massive breakout within its ascending triangle pattern, analysts predict. Traders anticipate significant price movement as the cryptocurrency continues to consolidate. Market sentiments remain bullish amid anticipation of potential gains.
Moreover, Ethereum has had quite an impressive performance this year, with its values surpassing $3k for the first time on February 19. In percentage gains, Ethereum outperformed Bitcoin as it benefits from a growing interest in decentralized applications (dApps), decentralized finance (DeFi), and non-fungible tokens (NFTs) that are built on its network.
As per Coinglass, open interest for Bitcoin futures has decreased by as much as 2.55%, with CME and Binance experiencing significant declines in the past 24 hours. This might show traders are either closing their positions out or reducing their leverage ahead of expiry. Conversely, within the last 24 hours, open interest for Ethereum futures increased by 2%.
Bitcoin Options Expiry Impact Analysis
The factors that could influence the direction of Bitcoin’s price include the upcoming expiration of options, which will expire 71k contracts worth $3.7 billion. Options are derivatives that give the buyer the entitlement to buy or sell an underlying asset at a given date along with a particular price.
Deribit, which is the largest exchange in the crypto options market, has a put-call ratio of 0.76 as indicated by its data. This implies that there are more put options than call options in the market. By definition, Put options are bets that imply that the price will go down, while Call options are bets that imply that the price will go up.
The put-call ratio suggests that traders expect a downward price movement or are hedging against a price drop. The max pain point, which is the price level that minimizes the losses for the majority of options holders, is $47,000. This means that if Bitcoin closes below this level on Friday, most options holders will suffer losses, while if it closes above this level, most options holders will profit.
Bitcoin is currently trading at the price of $50,917.02 with a current market cap of $1,000.11 billion. The cryptocurrency is down -2.60% over the last one day and its circulating supply stands at 19.63 million.
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