Bitcoin Bulls Eye $110K as $20B Options Expiry Approaches

Bitcoin traders eagerly anticipate the upcoming $20 billion options expiry set for June 27, which could give bulls an edge in pushing the price toward $110,000. Despite Bitcoin’s 1.72% drop over the past month, options traders, who hedged against downside risk, were already preparing for a sharper decline. 

This price recovery presents a crucial chance for bulls to solidify support at $105,000, potentially setting the stage for a new all-time high in the weeks ahead.

Open interest for call options (buy) is currently at $11.2 billion, compared to $8.8 billion for put options (sell). A significant portion of put options, worth $7.1 billion, have strike prices of $101,000 or lower, giving the advantage to bullish bets.

Bitcoin’s recent strength is partly attributed to a more dovish stance from US Federal Reserve Chair Jerome Powell. In his testimony, Powell indicated that rate cuts might be possible if inflation stays low. Other Fed officials have hinted at rate cuts as early as July, fueling market optimism. Bitcoin bulls are watching the S&P 500’s growth, viewing it as a sign that investors may shift from bonds to riskier assets, further boosting Bitcoin’s potential.

Even without immediate central bank actions to expand the monetary base, falling yields on fixed-income assets could further propel Bitcoin’s price upward. A key risk to this scenario would be increased uncertainty, potentially triggered by a drop in Bitcoin’s hash rate or geopolitical tensions, such as issues in the Middle East.

Five potential price scenarios based on current trends are outlined below, with theoretical profits based on open interest imbalances:

• $100,000 to $101,500: $1.74 billion calls vs. $1.75 billion puts (balanced outcome).
  
• $101,500 to $102,500: $1.86 billion calls vs. $1.62 billion puts (calls favored by $235 million).
  
• $102,500 to $104,500: $1.93 billion calls vs. $1.18 billion puts (calls favored by $750 million).
  
• $104,500 to $106,000: $2.47 billion calls vs. $1.06 billion puts (calls favored by $1.41 billion).
  
• $106,000 to $108,000: $2.84 billion calls vs. $750 million puts (calls favored by $2.1 billion).

For bears to maintain control, Bitcoin needs to dip below $101,500 by June 27, marking a 5% drop from the current price of $107,300. Bulls, on the other hand, can strengthen their position by keeping the price above $106,000, setting the stage for a potential July rally—especially if Bitcoin ETFs continue to see inflows.