Until two months ago, it was difficult to find an investor who believed that the price of Bitcoin (BTC) would rise to the $ 32,000 level. The BTC price, which changed hands around $ 13,300 on October 30, had to see a 140 percent increase to reach this level.
For this reason, the call futures created for the Bitcoin price to reach $ 32,000 at the end of January were made on Deribit exchange for $ 67, ie 0.005 BTC.
The price of the same call options reached $ 705 in the current period. So in less than four weeks, there was an almost 10-fold increase. Although the bitcoin price rose to $ 19,484, it still needs to see another 67 percent increase to reach $ 32,000.
Despite the recent BTC price surge, the probability of implied options (delta) currently stands at 11 percent. Call option price has also increased due to the fluctuation in the BTC price, as sellers will demand higher premiums to take risks in uncertain markets.
Situations such as intense price fluctuations and unexpected news feeds that will increase volatility often push the indicator upwards.
BTC price volatility has increased from 57 percent on 30 October to 78 percent this week. This situation means an increase especially for buy option buyers. Even if the BTC price remains the same, the Option price will rise due to this.
Analysis of option probabilities
Option pricing directly depends on how far the expiry date is. In other words, the $ 32,000 buy option can be considered worthless when two days remain until the Due date. Therefore, Investors should not be too caught up in the possibility of implied options (delta).
By looking at the search options for December 25, an investor might conclude that 26 percent appears to be low for $ 20,000. After all, an increase of 18 percent in a month seems unreasonable. Beware of Trader Short moves. However, in 9 of the last 12 months, there was an 18 percent increase in 30 days.
It hasn’t been long since the latest monthly increase of 18 percent or more. On August 23, Bitcoin found buyers at $ 11,645, up 22 percent from the previous month.
Traders and investors should consider purchasing longer term calling options. Those who are as bold as those who predicted a 150 percent increase in BTC price a month ago are extremely satisfied with the revenue they earned.
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