The upcoming crypto options expiry is threatening to add a significant amount of Bitcoin sell pressure that could take the price below another key support level.
Over $1.4 billion worth of Bitcoin (BTC) options are set to expire on Aug. 16 at 8:00 am UTC, according to Deribit. This sets Bitcoin’s “max pain point” to $60,000, which indicates the price at which most options contracts would expire worthless.
However, according to Cointelegraph data, Bitcoin fell over 3.6% during the past 24 hours to trade at $58,101 as of 8:35 am UTC.
BTC/USD, 1-day chart. Source: Cointelegraph
This means that the $1.4 billion worth of options will expire and introduce more downside volatility unless Bitcoin can stage a recovery above $60,000. Periods close to options expiry generally bring more price volatility into the crypto market.
Could Bitcoin ETFs help BTC price recover?
Inflows into US spot Bitcoin exchange-traded funds (ETFs) were positive for two consecutive days but turned negative again on Aug. 14, with net outflows exceeding $81 million, according to data from Farside Investors.
Bitcoin ETF Flow (USD, million). Source: Farside Investors
However, the favorable Consumer Price Index (CPI) reading could catalyze more inflows into the Bitcoin ETFs, according to Bitfinex analysts, who told Cointelegraph:
“The favorable CPI data is expected to catalyze further inflows. Investors are likely positioning themselves to benefit from the expected rate cut and the potential for a broader market rally. As a result, we might observe continued and possibly accelerated inflows into these ETFs, reflecting a shift in sentiment towards risk-on assets.”
The US Bureau of Labor Statistics (BLS) reported July Consumer Price Index (CPI) data on Aug. 14, showing annualized price increases for consumers of 2.9%, which marks the slowest rate increase since 2021.
ETF inflows can significantly contribute to a cryptocurrency’s price appreciation. For Bitcoin, ETFs accounted for about 75% of new investment in the cryptocurrency by Feb. 15 as it surpassed the $50,000 mark.
Could Bitcoin price dip below $56,000?
Bitcoin could dip below $56,000 before amassing more upside momentum.
Based on the market sentiment around Bitcoin whales, or large holders, BTC is likely headed to the $56,000 support, according to an Aug. 14 X post by Trade Confident crypto research platform, that wrote:
“Based on current market indicators, we are looking at $56k for $BTC's next move!”
Bitcoin whale smart money, sentiment indicator. Source: Trade Confident
The $56,000 mark acts as a potential demand zone for Bitcoin, according to pseudonymous trader Crypto Pump Analytics, who wrote in an Aug. 15 X post:
“Now the price of bitcoin is expected to reach the next demand zone of $56k. When bitcoin price comes near the $56k zone we will try long.”
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