The price of Bitcoin fell to near $70,000 on Friday after a sharp rise the previous day. The BTC options expiration event is currently keeping investors on the sidelines as the market anticipates potential volatility.
Conclusion
- Bitcoin price gave up some of its gains this week.
- More than $2.22 billion in options expiring today have raised concerns about volatility.
- Bitcoin technique remains stable despite the current decline.
According to crypto.news, the price of Bitcoin (BTC) fell 4.5% to an intraday low of $70,177 on Friday morning Asia time, before stabilizing around $70,400 at press time. The bell pulled back after encountering a rejection near $74,000, a key resistance level it had failed to break in more than a month.
Bitcoin prices fell after investors started booking profits after rising more than 15% in the last 5 days.
This comes amid the ongoing war between the US and Iran, which has pushed energy prices to multi-month highs. Military growth has also spurred capital flows into traditional safe-haven assets, which have seen relatively better performance amid geopolitical uncertainty.
Today, investor sentiment is under control as the $2.22 billion Bitcoin option expires on the Deribit exchange at 8:00 UTC. More than 31,500 open Bitcoin contracts expire.
At press time, the put-to-call ratio was 1.72, which means that options or traders betting on Bitcoin to go lower far outnumber calls that are betting to go up. The maximum pain point for BTC, or the price at which most option contracts expire worthless, was $69,000, just $1,400 below the current spot price.
The maximum pain level, also known as the strike price, tends to pull spot prices to the center around expiration. Therefore, there remains a high risk that the price of Bitcoin may return to the $69,000 mark, as options run out.
Bitcoin has failed to break above $70,000 six times since the start of February, and losing that key psychological support could once again spook short-term traders who were betting on the current recovery rally.
Despite concerns about the massive options ending today, BTC price charts have yet to show signs of a breakout.
On the 24-hour chart of Bitcoin / USDT, momentum indicators still showed a positive outlook, at least in the short term.
It is worth noting that the MACD line was pointing upwards, indicating increasing bullish buying pressure compared to bearish selling pressure. At the same time, the Relative Strength Index also made a high divergence with price action.
Currently, the bulls are looking at $72,000 as the next resistance level for the claim, a break above which could end the downtrend today.
Conversely, a move below the $70,000 support could take BTC price down to $69,000 and further down to $60,000 as the broader structure is in a bearish flag pattern, which is considered one of the most negative forms of technical analysis.
Disclosure: This article does not provide investment advice. The content and materials on this page are for educational purposes only.
