In his recent analysis of the Bitcoin market, crypto expert Joao Wedson highlighted that the forthcoming expiration of options could significantly influence prices in the near term.
Wedson pointed out that the options expiration scheduled for December 26th represents the largest event of its kind this year. This particular expiry includes both quarterly and annual contracts, amounting to a staggering nominal value of around $23.3 billion. He mentioned that the Maximum Pain level within this market stands at $95,000, which is likely to exert a considerable “pull” on prices shortly.
The analyst observed that although there is a low bid/ask ratio present, leverage in the market remains high. Short positions are predominantly clustered around $95,000 while long positions are building up beneath $84,000. He emphasized that there is still a significant liquidity pool at the $95,000 mark and noted its alignment with Deribit’s Maximum Pain Point for options as particularly important.
Discussing short-term investor behavior, Wedson remarked on traders’ consistent trend of opening long positions lately. This trend increases the likelihood that Bitcoin’s price may initially rise towards $95,000 before experiencing a sharp decline below $84,000. Conversely, he suggested an alternative scenario where prices might first dip to $84,000 before rebounding quickly back to reach $95,000.
The analyst concluded by stating that regardless of which scenario plays out next—whether bullish or bearish—both sides are likely to face repercussions during this process.
*This does not constitute investment advice.