Bitcoin’s Wild Ride: Will it Soar or Crash? The $85k-$100k Mystery Unveiled!

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Markets

What to know:

  • Bitcoin‘s derivatives market is like a well-behaved puppy, showing stability with strong support at $85,000 and a “please don’t touch” sign at $100,000.
  • Traders are confidently selling put options at $85,000, suggesting they believe Bitcoin won’t suddenly decide to do a belly flop below this level anytime soon. 🐶
  • Meanwhile, call options are being sold at $100,000-because who doesn’t like a little insurance against a rocket launch?

In a thrilling twist that would make even the most seasoned roller coaster enthusiast proud, Bitcoin’s derivatives market is signaling a stable and broad range of prices-no massive moonshot or dramatic crash in sight. 🚀

The activity on Deribit options is akin to a safety net, with heavy put selling providing robust support around $85,000. It’s like having a life jacket while sailing on the unpredictable seas of cryptocurrency.

At the same time, some traders are playing it safe by offering protection against price surges beyond $95,000-$100,000, effectively creating a resistance wall-think of it as building a moat around your castle. 🏰 According to data from our friends at Wintermute, this cautious optimism is quite the spectacle.

So, volatility could be taking a nice, cozy nap within this range as both put and call sellers merrily collect their premiums from options sales, like kids collecting candy on Halloween. 🍬

“Strong put-selling support around 85k (then 80k/75k as secondary buffers), while call overwrites cap upside around 95k-100k. Vol is being harvested inside this band,” Wintermute’s Desk Strategist Jasper De Maere cheerfully informed us via email-possibly while sipping a latte. ☕

Put selling builds a floor

Put options, for those not in the know, are contracts that pay out if the underlying asset decides to take a nosedive below a certain price. So when traders sell the $85,000 strike put, they’re practically shouting, “Don’t worry, Bitcoin! You’ve got this!”

When a vast number of traders sell puts at a specific level, it creates a self-fulfilling prophecy-like when you tell yourself it’s fine to eat that extra slice of cake. 🍰

In Bitcoin’s case, the $85,000 put is like the popular kid in school, with the second most popularity across all expirations and a staggering open interest of over $2 billion. That’s some serious dough! On Deribit, one options contract represents one Bitcoin, making it a hot commodity.

If prices start flirting with that level, it’s likely that put sellers might just buy Bitcoin in the spot or futures market, reinforcing that support like a trusty sidekick. 🦸‍♂️

Call overwriting creates resistance

On the higher end, Bitcoin holders are selling call options against their long positions around $95,000 to $100,000. These “overwrites” are like putting a big “sold” sign on your house but only if the price gets too high. They generate income through premiums, but if prices soar past those levels, well, it’s time to deliver the goods!

The result? These call sellers could add a bit of pressure to the spot market if prices get too close to that elusive $100,000 mark, making it harder to break through-like trying to squeeze into your jeans after the holidays. 🎄

In fact, increased interest in selling the $100,000 strike call suggests that enthusiasm for a rapid rally into six figures is about as common as finding a unicorn. As of now, the $100,000 call is the belle of the ball with an open interest of $2.37 billion. 📈

Volatility harvesting in play

“Vol is being harvested,” De Maere noted, referring to traders selling both puts and calls to pocket those sweet premiums. This strategy generates yield by betting on dwindling volatility-hence the catchy term “volatility harvesting.” 🌾

These options lose value over time and expire worthless if Bitcoin keeps trading sideways, allowing sellers to keep all those delicious premiums. Yum!

As of now, BTC is changing hands at $87,400-so keep your eyes peeled and your wallets ready, folks! 🤓

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2025-12-16 22:25