• Cryptocurrency options exchange Deribit saw many calls traded at $65,000, $70,000, and $75,000 over the weekend.
• The concentration of activity in these so-called out-of-the-money calls reflects bullish market sentiment.

Fears of a fall in Bitcoin (BTC) prices due to technical overbought conditions and a potential sell-off from the bankrupt Genesis may have passed. Traders are jumping into bullish options investments, such as cheap out-of-the-money (OTM) calls, at Bitcoin’s all-time high of around $69,000.

Over the weekend, a large number of $65,000, $70,000, and $75,000 call options were traded on Deribit, the world’s largest crypto options exchange by trading volume and open interest. It was done. On Deribit, 1 option contract is equivalent to 1 BTC.

A call option gives the investor the right to buy the underlying asset at a specified price by a specified date, and a put gives the investor the right to sell. Call buyers are implicitly bullish on the market.

The large-scale buying of calls with high strike prices reflects the bullish mood of sophisticated market participants.

“In the options market for April to June expirations, open interest is concentrated in the $50,000 call, with flows seen in the $50,000, $60,000 and $75,000 calls,” he said. Kelly Greer, head of Americas sales at ), said in an interview with CoinDesk. “These flows suggest that investors have a constructive view of Bitcoin.”

Greer added that similar activity concentrated in the $30,000 and $40,000 OTM calls in Q4 2023, paving the way for price appreciation through these levels.

Options market positioning is a reliable indicator of impending price movement. The recent bull run is reminiscent of the 2020-2021 bull market.

Bitcoin has nearly doubled since early October to $50,000, and the price has risen from $38,500 over the past three weeks, largely due to strong ETF inflows.

The 14-day Relative Strength Index (RSI), a popular technical indicator, is above 70, indicating that the Bitcoin market is overbought. This number is often taken as a signal that a reversal to a bearish trend is imminent, but it could just mean that the market has risen a bit too quickly in a short period of time and may just be taking a breather.

“Bitcoin posted its seventh straight day of gains, but the strength slowed over the weekend. It also coincided with a move above 70 on the daily RSI, which could increase players’ short-term profit-taking appetite. We need to be careful as we approach the peak,” FxPro market analyst Alex Kuptsikevich said in a Feb. 12 email.

In addition, the bankrupt crypto asset lending company Genesis sold $1.6 billion worth of Bitcoin, Ethereum (ETH), and Ethereum Classic (ETC). There are also concerns that prices may fall. Genesis recently petitioned a U.S. judge to approve the sale of the above-mentioned crypto assets held in a Grayscale trust product.

｜Translation: CoinDesk JAPAN
｜Edited by: Toshihiko Inoue
｜Image: Shutterstock
｜Original text: Bitcoin Traders Scoop Up Options Bets at $65K and Higher