Bearish Bitcoin Traders Eye Victory as BTC Options Nearing Expiry Threaten Sub-$30K Levels

• This week’s Bitcoin options expiry could solidify the $30,000 resistance level, possibly giving bears the advantage for the first time in a while.
• Regulatory uncertainties and stricter controls are boosting the bears’ efforts to maintain Bitcoin’s price below $30,000.

Bitcoin bears are circling, eyeing a potential victory as this week’s Bitcoin options expiry on Friday, July 21, could reinforce the $30,000 resistance level. This scenario could grant them an advantage not seen since the notable 21% surge between June 14 and June 21.

Fluctuations Coinciding with Options Expiry

Recent Bitcoin price trends indicate significant volatility surrounding three of the last four Bitcoin options expiries. These data points illuminate the importance of traders’ vigilance during these pivotal moments. Although a causal relationship cannot be established definitively, the considerable magnitude of these price fluctuations mandates careful observation, particularly in the run-up to the weekly expiry on July 21.

The dominance of bears in the short term could result from heightened regulatory measures. Nonetheless, a potential advantage for the bulls lies in the ongoing review of spot exchange-traded fund proposals by the United States Securities and Exchange Commission (SEC).

Despite the proposals being in early regulatory evaluation stages, the sluggish pace of progress might partly elucidate why bears have successfully defended the $31,000 level on several occasions since late June. However, their greatest opportunity to keep Bitcoin’s price below $30,000 could be rooted in the deteriorating regulatory climate.

On July 19, the global securities exchange, Nasdaq, postponed the launch of its cryptocurrency custodian solution due to regulatory ambiguity in the United States, a decision justified by Nasdaq’s CEO, Adena Friedman. Moreover, on July 14, cryptocurrency exchange Coinbase announced the suspension of its staking services for clients in certain states following a lawsuit from the SEC.

Unfulfilled Bullish Optimism

Bitcoin’s price briefly broke the $31,000 barrier on July 13 and 14, sparking bullish speculations via options contracts. However, a subsequent correction within four hours saw the price retreat to $30,000.

The put-to-call ratio of 0.39 mirrors the disparity in open interest between the $430 million call (buy) options and the $170 million put (sell) options. Nevertheless, the final outcome will be less than the total $600 million open interest due to overconfidence from the bulls.

Looking at the current price action, Bitcoin’s expiry price falling below $30,000 will invalidate the bulls’ call instruments. Consequently, while a potential $35 million win for the bears may not be substantial, it does enhance the probability of $30,000 emerging as a new resistance area.