Bitcoin’s price trajectory has been uncanny and slightly unpredictable in the past couple of weeks. The reason has been unknown to this, with both the bullish and bearish behavior having unclear direction.
The price of BTC had plunged to $55000 in the last week. The market has been highly volatile with price variations but as far as the price stays above a certain range level till the end of this month, the boat would stay afloat. Currently, BTC is trading at $57992.
Effect of Quarterly Expiration on BTC
26th of March can be a significant day for the Bitcoin market, because of its importance in the derivatives market, the Options market in particular, as it decides the number of active contracts and its liquidity worth at certain expiration dates.
The next quarterly expiration for major options is on 26th March, and this might spark a noticeable change in the price of Bitcoin.
The previous two quarterly expires were on 25 September 2020 and December 2020, right after the September expiry a strong bull run skyrocketed Bitcoin to its then all-time high of $20000.
The second expiration of December also allowed Bitcoin to have a bull run and climb up to $50000 in 2 months.
The upcoming expiry on March 26 is going to be more eventful than the previous one’s, this date is currently attracting the highest liquidity in the market.
However, this time a straightforward bull run might not happen, it would surely get dramatic and volatile, either set to achieve an all-time high or an all-time low.
The state of Bitcoin CME Options
Currently, in the market, the number of put buys has risen in number in the last month, according to reports there are 3 put sells for every 4 call buys, making it the highest ratio ever.
Anyways this ratio hasn’t affected the bullish nature of the market as these puts were in the $40000- $60000 range, indicating a controlled correction.
Although, these BTC CME options are not representative of the whole market, as the contracts are just around 1500 which means it is equal to 7500 BTC.