BTC/USD Daily Chart
The options market data can often provide additional relevant insights on market sentiment. Many options traders expect the Bitcoin rally to continue into 2021 as seen in strike prices between $36,000 and $50,000 in the medium term. Historically, Bitcoin rallied 12- 15 months after halving boosting the chances of a larger uptrend in early to mid-2021. Deribit users are betting on BTC reaching $100,000 through options contracts that expire on Sept. 24, 2021.
Denis Vinokourov, head of research at Bequant stated that presently the probability of a $36,000 and $52,000 strike remains low due to “trading mis-pricing and hedging” Guy Hirsch also stated that options interest indicates a rally to the mid-$30,000s could happen. Near-term bearish calls put Bitcoin at $20k. However, both expect pullbacks are likely to happen after the recent rally.
Bitcoin options total open interest. Courtesy: cryptorank.io
Typically, analysts expect corrections on BTC price, if they occur, retail investors can start buying the dip and institutional investors accumulate later.
One of the main reasons for the lack of major pullbacks is the decline in Bitcoin’s dependence on the futures market. Spot volumes are growing, fueled by rising institutional demand.
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