On February 5, the $ 1 billion Bitcoin Options (BTC) open interest rate expires. That number is small compared to the expiration of the $ 4 billion options last month, but the monthly and quarterly options tend to focus more.
Friday’s ending is somewhat unusual, although it is offset by current BTC levels. The data also shows that the bulls have a lot of incentive to push the price above $ 38,000.
Deribit owned 84% of the market at the end of Friday. By analyzing the total open interest rate between $ 28,000 and $ 43,000, a neutral bullish call of $ 300 million can be identified against $ 290 million of the open interest rate on put options.
Thus, a blow analysis of 25% above or below the current BTC price gives roughly equilibrium on both sides.
Based on the data above, the neutral bearish sell options are concentrated at $ 34,000 or less. There is a perfect balance of irregularities between $ 34,000 and $ 36,000 because the buy and sell options are the same.
Despite the difference of less than $ 32,000, the incentive to lower the price is an imbalance of 3,400 Bitcoin contracts. This results in an open interest rate of $ 109 million with a negative price movement of 13% or more. Despite nominal importance, creating the incentives to catch bulls is not enough.
On the other hand, if the bulls want to raise the price to $ 38,000, it will cause an imbalance of 2,800 BTC contracts. This corresponds to an open interest rate of $ 106 million with positive price volatility of 4%, which is the best risk return for such an effort.
To assess whether market producers and arbitrage services consider risk positive and negative, the most useful indicator is a delta deviation between 30% and 20%. Measures the difference in insurance premiums between neutral and stacked upside calls versus similar POS.
Numbers between 0 and 15 are neutral, while the negative delta divergence indicates that big options traders are requesting additional bonuses to bear the risk of imperfections, so they are considered bearish.
The last time such a situation occurred was on December 29th, and for the past five days the index has been at level 10. This data shows the perfect balance of risks, which means that market makers and arbitrage services have no incentive to pay BTC not. Regardless of what expires on February 5.
The OKEx, Bit.com, and Deribit weekly agreements expire on February 5 at 8:00 UTC.