According to some data, another negative process may be waiting for us for Bitcoin (BTC). Here are the data and possible effects on the futures and options market…
Is it the next drop for Bitcoin?
According to the data, if some technical analysis is correct, Bitcoin could be ready for another downside move. As we reported on Kriptokoin.com, the largest cryptocurrency by market cap has pulled back more than 50 percent this year. It sits in the roughly $19,000 to $25,000 range as monetary adjustments have been tightened recently. As of writing, it’s changing hands at around $21,700, up 1%.
Meanwhile, options data show that some traders are paying a premium to guard against a possible dip below the lower limit of the trading range. Meanwhile, seasonal patterns pin September as a testing month for the digital token. Experts point to four bad charts for the biggest cryptocurrency. You can see the graphs as follows:
Option request
Traders pay much more for protection under $18,000. The implied volatility skew indicates that traders are willing to pay high premiums for unprofitable sales. According to experts, the bounce is closer to the $15,000 level, which has the second-highest concentration of sales, especially for the end of September.
Negative hedging
Skew shows steep demand for BTC as a hedge asset if Bitcoin drops below $18,000
seasonality
September tends to be the worst month for Bitcoin, with an average price drop of around 10 percent over the past five years.
Lean performance
Bitcoin prices have fallen every September over the past five years
open position
Data on options contracts expiring at the end of September shows that $20,000 is the maximum open interest strike price. Therefore, a sustained break below this could force sellers to hold their positions, further depressing prices and bringing June lows back into focus.
floor test
End of September shows maximum open interest at $20,000
poor performance
Bitcoin is lagging behind ETH, which has recently risen after an upcoming update to make the Ethereum network more efficient. Ethereum will switch from proof of work consensus mechanism to proof of stake with the merge expected to take place on September 15th. Thus, it will reduce energy consumption. In addition, the efficiency of the network is expected to increase. Due to this expectation, the value of ETH has seen $ 2,000 after a long time in the past weeks.
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