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Rollblock– Bitcoin has demonstrated remarkable resilience despite the expiry of over $14.2 billion worth of Bitcoin options on December 27, 2024, which many expected could trigger a significant price correction. The expiry occurred with a ‘max pain’ point set at $85,000, indicating the price level where the majority of Bitcoin options would expire worthless. Despite the potential for a downside move, Bitcoin’s price held strong, reaching above $97,330 an hour after the expiry event.
Bitcoin Options Expiry: A Key Market Moment
On December 27, Bitcoin options contracts worth over $14.2 billion expired at 8:00 a.m. UTC. The ‘max pain’ point of $85,000 had raised concerns of a sharp drop, but Bitcoin defied these expectations. According to a tweet from the Deribit Exchange on December 26, the expiry of these options, coupled with leveraged positions, could trigger a rapid snowball effect if the price dropped significantly.
However, Bitcoin’s price remained resilient and even peaked at over $97,330, as per data from Cointelegraph Markets Pro. This demonstrates the cryptocurrency’s ability to hold its ground despite significant volatility in the derivatives market.
Bitcoin ETFs End Losing Streak with Major Inflows
The United States Bitcoin exchange-traded funds (ETFs) experienced a significant turnaround after a rough few days. On December 26, Bitcoin ETFs saw inflows exceeding $475 million, marking the end of a four-day losing streak. According to Farside Investors, this surge in investment came shortly after Christmas and could signal renewed institutional interest in Bitcoin.
Bitcoin ETFs have been instrumental in Bitcoin’s price rally in 2024, accounting for about 75% of the new investment in Bitcoin. The influx of capital from ETFs played a significant role in pushing Bitcoin’s price above the $50,000 threshold in early 2024, with further gains expected as the year progresses.
Bitcoin Faces Resistance at $98,000: Potential for Short Squeeze
Despite Bitcoin’s resilience, it faces significant resistance near the $98,000 mark. A breakout above this level could trigger a massive short squeeze, liquidating over $885 million in leveraged short positions across various exchanges, according to Coinglass data. Such a move could provide the necessary momentum for Bitcoin to push higher.
Post-Holiday Liquidity Surge: Impact on Bitcoin’s Price Action
As the Christmas holiday period concludes, analysts anticipate a return of institutional liquidity into the crypto market, potentially driving Bitcoin’s price upwards. Ryan Lee, chief analyst at Bitget Research, highlighted that “Post-Christmas, market activity typically picks up again,” with institutional funds expected to target sectors poised to benefit from upcoming economic developments, such as the potential impact of the U.S. presidential inauguration.
According to Lee, this renewed liquidity could help Bitcoin regain momentum, possibly pushing it above $105,000.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
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