Bitcoin call options, before the end-of-month expiration in February, are concentrating at strike prices above $50,000, although the price of the largest cryptocurrency in the world by market capitalization fell below that barrier on Tuesday due to fresh inflation statistics from the United States.
Deribit data indicates that there is a significant concentration of open Bitcoin call options at strike prices of $60,000, $65,000, and $75,000 in the run-up to the end-of-month expiry on February 23.
“The strike price with the second highest open interest is $60,000 and the current day second highest options contract in terms of volume traded is bitcoin call options with a strike price of $75,000 for the June 24 expiry,” Jag Kooner, Head of Derivatives at Bitfinex.
Kooner went on to say that many long-term bullish traders are buying these inexpensive call options with strike prices significantly higher than the current price of bitcoin as the market tries to break over the critical $50,000 psychological barrier.
A considerable percentage of market participants appear to have a specific interest in or expectation that the price of bitcoin will grow above this level before the next end-of-month expiration date, based on the concentration of bitcoin calls at the $60,000 strike price and above.
Kooner asserts that there is a strong long-side bias in the options market. According to the Bitfinex researcher, the volume of call spread bets in the futures market has been rising since Bitcoin passed the $48,000 threshold.
He continued, “The current overall open interest spread is biased towards calls at a 0.47 put-call ratio. The overall market put-call ratio in the past 24 hours is 0.60. A ratio of 0.59 based on options expiring on February 23 extend the current trend.”
A put-call options ratio of less than one suggests that the market is in a bullish mood as the call volume is higher than the put volume. A trader buying call options is seen implicitly positive on the market, whilst a put buyer is considered negative.
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