Data from TradingView shows Bitcoin reached $ 58,390, up about $ 3,100 in less than 3 hours.
Bitcoin rallied 5.5% on the day, setting a five-month high rendering short positions above $54,260 worthless amid optimism from the bulls.
Analyst Michaël van de Poppe comment:
Meanwhile, analyst Rekt Capital has confirmed a higher low for Bitcoin during the retracement.
#BTC forms a Higher Low on the dip and continues to maintain the blue level as support— Rekt Capital (@rektcapital) October 13, 2021
These are the two levels BTC needs to hold as support to maintain the highs$BTC #Crypto #Bitcoin https://t.co/yX5LKVboRn pic.twitter.com/6JhzRPP3v6
Amid the optimism, people are targeting six figures after Bitcoin broke out of a multi-month downtrend and confirmed that an uptrend is underway.
If Bitcoin happens to be entering a Parabolic move towards $110,000, that would eventually align with the predictions of the Stock-to-Flow (S2F). According to PlanB, the scarcity and valuation of gold and other precious metals and the “energy FUD of Elon Musk and China's mining crackdown" were a few of the factors that contributed to the 50% or higher accuracy for the model over the past five months.
The bulls' hopes are largely based on an exchange-traded fund (ETF) is being approved by the US Securities and Exchange Commission (SEC) review for approval. Currently, there are many proposals awaiting approval between October 18 and November 1, but the regulator may delay its final decision.
The aftermath of China's mining crackdown is a key event that could boost investor sentiment and research shows that the US accounts for 35.4% Bitcoin hashrate.
Furthermore, US states like Texas and Ohio are also expected to receive additional large-scale Bitcoin mining hubs, which will boost the US crypto market share even higher.
Futures open interest is more than 70%
While, data From derivatives markets, open interest (OI) for Bitcoin futures on CME has skyrocketed over the past month, further fueling the positive cause of upcoming price action.
While still below the all-time high (ATH) from February, the trend is encouraging considering the possibility of traders seeking the approval of Bitcoin. ETF based on futures contracts in the United States.
Bitcoin Futures Open Interest Chart | Source: Javier Paz / Twitter
CEO of Three Arrows Capital, Zhu Su say more on data from Forbes analyst Javier Paz.
“Bitcoin Futures Open Interest on CME Grows 20k BTC in Over a Month, Notable.”
Bulls prevail before option expiration
The $830 million option expiration tomorrow (October 15) is largely influenced by the 20% bull run that started on October 4, which most likely eliminated the 92% put option.
Bitcoin Price Chart | Source: TradingView
After last week's estimated net profit of $370 million from options expiration, the bulls have gained strength and this is evident on the expiration of $820 million in options tomorrow. This advantage explains why the call option's open interest is 43% greater than the neutral to bearish put.
Bitcoin Options OI Summary for October 15 | Source: Bybt
As the data above shows, the bears have placed $335 million in bets for Friday's expiration, but it looks like they were taken by surprise as the 92% put the put option is likely to become worthless.
In other words, if Bitcoin stays above $56,000, only $36 million in neutral to bearish put options will be activated at 3pm tomorrow (UTC).
Here are the four most likely scenarios for the October 15 option expiration. An imbalance in favor of either party represents a potential profit from the expiration. In other words, depending on the expiration price, the number of active buy and sell contracts will vary:
- From $52,000 to $54,000: 3,140 buy orders vs 2,110 sell orders. The net result is $55 million in favor of call options (bulls).
- From $54,000 to $56,000: 3,700 buy orders vs 1,240 sell orders. The net result is $130 million in favor of call options (bulls).
- From 56,000 USD to 58,000 USD: 4,850 buy orders vs 680 sell orders. The net result is $235 million in favor of call options (bulls).
- Above 58,000 USD: 6,230 buy orders vs 190 sell orders. The net result is complete dominance, bulls make $350 million.
This rough estimate considers the call to be used only in bullish bets and puts the option in neutral to bearish trades. However, investors could have used a more complex strategy, often involving different expiration dates.
In any case, the bulls have absolute control and there are several reasons for them to keep the price above $56,000. On the other hand, the bears need to push the 7% drop below $54,000 to avoid losing $235 million or more.
However, traders must consider that during rallies, sellers' attempts to put pressure on prices are enormous and often ineffective. The analysis points to a significant advantage from the calls, prompting further bullish bets next week.