Bitcoin (BTC) has been trading in a bearish channel pattern since its all-time high of $ 67,000 on October 20, just one day after the Bitcoin Strategy ETF (BITO) ProShares hit the Nasdaq.

However, the bulls have enough incentive to lock the bitcoin price above $ 60,000 on October 29, when the $ 3.2 billion one-month option expires.

Bitcoin price in USD on Coinbase. Source: TradingView
At the moment, investors are showing mixed feelings about ETF approval, despite total assets reaching $ 1 billion within 48 hours. Either the market expectations of these funds were unreasonably high, or the event predicted a 42% rise from October to October 19.

Uncertainty in regulation in the United States is also a critical factor preventing some large institutional investors from entering the sector. At a hearing before the US Senate Committee on October 26, Rustin Behnam, acting head of the Commodity Futures Trading Commission (CFTC), compared a government filing for digital asset space to a police officer on duty.

Behnam added:

“Current market transactions represent a significant portion of the risk associated with digital assets.”
The bulls are looking for a potential profit of $ 715 million.
These observations usually have little or no effect on the beef market, raising the question of a 13% recovery as the October 20 peak marks the end of a positive cycle.

The monthly expiration of October 29th will be a test of strength for the bears, as any price above $ 58,000 translates into a profit of $ 385 million or more for the bulls.

On October 29, bitcoin options collect open interest rates. Source: Bybt
On the surface, $ 1.94 billion put options outnumber monthly maturities by 56% compared to $ 1.24 billion put options.

However, the buy-to-buy ratio of 1.56 is sincere because the bears were surprised and most of their buying options would be wiped out if the bitcoin price stays above $ 58,000. 08:00 UTC, October 29.

Possession of a put option, which entitles you to sell bitcoin for $ 55,000, becomes useless if the price of BTC exceeds this level.

Bulls are comfortable for $ 58,000
Sixty-eight percent of the put options that refer to the right to sell bitcoins at a predetermined price are placed at or below $ 58,000.

Here are the four most likely scenarios based on the current price level. In addition, the data shows the number of contracts that will be available on October 20th for both calls and puts.

From $ 52,000 to $ 55,000: 6,500 calls for 6,530 points. The result is a balance between bulls and bears.
$ 55,000 to $ 58,000: 9,510 calls to 4,610 locations. The net profit for the bulls is $ 270 million.
$ 58,000 to $ 60,000: 9,900 calls for 3,490 points. Net income continues in favor of the bulls at $ 385 million.
Over $ 60,000: 13,870 calls for 1970 put. The net result will benefit the bulls $ 715 million.
As explained above, the imbalance in favor of both sides represents the theoretical potential profit on maturity.

This rough estimate takes into account call (call) options used in bullish strategies and put (sell) options exclusively in neutral or bearish trades. However, a trader can sell a put option and actually get a positive share of bitcoins above a certain price. Unfortunately, there is no easy way to calculate this effect.

Can a Bitcoin pin hold less than $ 55,000?
Bears need a 6% retracement from the current $ 58,500 price to avoid losing $ 270 million. While this may not seem like a lot at first, traders should also take into account the bullish momentum generated by ETF approval.

With less than 36 hours before the October 29 deadline, the bulls are likely to prevail by keeping Bitcoin above $ 59,000. For bears, it seems like a long way to go below $ 55,000, but it might be worth it.

Source: CoinTelegraph