Activity among options traders suggests that Bitcoin’s (BTC) price is likely to move back above $30,000 U.S.
The price of Bitcoin declined 6% in July to $28,820 U.S. as equity markets continue to strengthen.
However, decentralized exchange SynFutures said in a note to clients that activity among options traders suggests that Bitcoin’s price is not likely to be down for long.
Specifically, SynFutures noted that there is a lack of bearish bets against Bitcoin among options traders, which signals that the traders are unwilling to bet on a continued decline in the largest cryptocurrency by market capitalization.
“This suggests they (traders) don’t foresee the $30,000 level transforming into significant resistance, at least in the near-term,” said SynFutures.
Bitcoin reached a 52-week high of $31,800 U.S. earlier this year and is still up 74% in 2023 despite the pullback seen in July.
Asset management giant BlackRock’s (BLK) spot Bitcoin ETF application and a favorable court ruling concerning Ripple’s XRP token have been positive catalysts for Bitcoin.
However, the price of Bitcoin has fallen below the key support level of $30,000 U.S. in recent weeks as the rally in stocks gathers steam, leading to handwringing among crypto bulls.
SynFutures said the options action suggests that losing the $30,000 U.S. level is likely only a short-term deviation for Bitcoin.
Options are trading instruments that allow investors the right to buy or sell an asset at a set price in the future. Essentially, options enable investors and traders to bet on whether a stock or cryptocurrency is likely to rise or fall in value over a set period.
So far, traders appear skittish about betting that Bitcoin’s price will continue to decline in the coming weeks and months.
