3 reasons why bears aim to pin Bitcoin below $30K for this week’s BTC options expiry

Bitcoin's drop to $25,500 on May 12 took bulls by surprise because less than 1% of the call option bets for May 13 have been placed below this price level.

Bulls might have been fooled by the recent attempt to overtake $40,000 on May 4, because their bets for May 12's $610 million options are largely concentrated above $34,000.A broader view using the 0.90 call-to-put ratio shows a slight advantage for the $320 million put options versus the $290 million call instruments. But now that Bitcoin is below $30,000, most of the bullish bets will become worthless.

If Bitcoin's price remains below $30,000 at 8:00 am UTC on May 13, only $1 million worth of those call options will be available. This difference happens because there is no use in the right to buy Bitcoin at $30,000 if it trades below this level at expiry.The three most likely scenarios based on the current price action are listed below. The number of options contracts available on May 13 for call and put instruments varies, depending on the expiry price.

For instance, a trader could have sold a put option, effectively gaining positive exposure to Bitcoin above a specific price but unfortunately, there is not an easy way to estimate this effect.Bitcoin bears need to hold the price below $30,000 on May 13 to secure a $260 million profit. On the other hand, the bulls' best case scenario requires a 10.7% gain from the current $28,900 to the $32,100 zone to limit their losses to $150 million.

Bitcoin bulls had $1.73 billion in leveraged long positions liquidated over the past three days, so they probably have fewer resources to push the price higher in the short term. With this said, bears have greater odds of suppressing BTC below $30,000 before the May 13 options expiry.

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