Bitcoin Bears Maintain Upper Hand Following Massive Options Expiry on August 16

  • The Options expiry on 16 August significantly impacted cryptocurrency price movements.
  • Bears maintain control despite potential stabilization in trends.
  • Options data revealed a bearish market sentiment for Bitcoin and Ethereum.

Understanding the impacts of Options expiry on Bitcoin and Ethereum prices, with a detailed market outlook.

Insights from the Bitcoin and Ethereum Options Expiry

Bitcoin and Ethereum experienced notable price volatility approaching the Options expiry on 16 August. On the preceding Wednesday, Bitcoin’s value dramatically dropped from $61.8k to $57.9k within just a day. Such significant price swings were observed as traders anticipated the expiry, which often leads to volatility spikes in asset prices.

Bears in Command Despite Flashes of Stability

Despite a potential for price trend stabilization, technical indicators and liquidity charts suggested a bearish trajectory could be more likely. Data from Deribit illustrated the overall bearish market sentiment, where the notional value of Bitcoin Open Interest hovered around $1.414 billion just before the expiry.

Market Sentiment and Max Pain Points

The put/call ratio for Bitcoin stood at 0.83, signaling a market sentiment that was slightly bullish but relatively balanced. The max pain point was identified at $59.5k, representing the level at which most Options would expire worthless. Notably, the price drop below $58.5k on Thursday did not see a reversal.

Ethereum’s Parallel Bearish Outlook

Similarly, Ethereum’s Options expiry amounted to $476.7 million, with a comparable put/call ratio indicating a slightly bullish sentiment. However, Ethereum’s price remained under $2610, and the max pain point stood at $2650. By Friday, both Bitcoin and Ethereum experienced modest gains of 0.8% and 0.4%, respectively, following the volatility induced by the Options expiry.

Future Projections for Cryptocurrency Markets

Looking ahead, a reduction in volatility is anticipated, yet both leading cryptocurrencies exhibit bearish tendencies. Bitcoin’s market structure is distinctly bearish, with the On-Balance Volume (OBV) depicting consistent selling pressure on the 6-hour chart. This momentum, or rather the lack of upward thrust, aligns with the existing market structure, indicating no imminent reversal.

The Role of Liquidity Maps and External Data

Further analysis via liquidation heatmaps indicated closer downward targets, making a southern movement more plausible. For Bitcoin, liquidity pools were noticed around $55.1k and $53.9k, whereas substantial liquidation levels to the north at $70k seem unreachable in the near term. In Ethereum’s case, the nearest liquidity pocket was at $2.4k, with an upside target band between $2.8k and $2.9k being less likely.

Macroeconomic Factors and Market Expectations

The Consumer Price Index (CPI) data reported a 0.2% month-on-month increase for July, which met market expectations. However, with reduced probabilities for a significant Federal Reserve rate cut, various technical, liquidity, and macroeconomic factors appear to favor bearish trends in the upcoming month.

Conclusion

The recent Options expiry delivered a clear message that bears currently hold the upper hand in the cryptocurrency markets. Both Bitcoin and Ethereum showed signs of bearish momentum, backed by technical indicators and liquidity trends. While a stabilization might occur, the bearish outlook seems set to persist in the short term.

Don't forget to enable notifications for our Twitter account and Telegram channel to stay informed about the latest cryptocurrency news.

BREAKING NEWS

Bitcoin Price Levels: Threat of $95,000 Liquidations and Potential Surge Beyond $99,000

According to COINOTAG News</ on November 24th, recent data...

Luggis.eth Unlocks $1.03 Million in ILV from Illuvium Farming and Swaps for 286 ETH

On November 24th, COINOTAG reported a significant transaction within...

Bitcoin Volatility Index Drops to 66.32: Insights on Market Expectations and Trends

On November 24th, the BitVol Index, a metric designed...

Bitcoin Miners Opt for Empty Blocks: Economic Strategy at Height 871732

On November 24th, COINOTAG reported a significant occurrence in...

Howard Lutnick Strengthens Financial Ties with Tether Holdings Ltd. to Launch Billion-Dollar Bitcoin Loan Initiative

On November 24th, 2023, COINOTAG reported that renowned entrepreneur...
spot_imgspot_imgspot_img

Related Articles

spot_imgspot_imgspot_imgspot_img

Popular Categories

spot_imgspot_imgspot_img