On January 6, derivatives traders are currently particularly focused on the Bitcoin call option with a strike price of $120,000 - this is the most popular option on Deribit, with a notional open interest of $1.52 billion. The put/call ratio of all expiry dates on Deribit has dropped to 0.24. This ratio compares the trading volume of put options and call options, highlighting the bullish sentiment in the market, as traders are positioning themselves for a potential price increase. A ratio below 1.0 indicates a preference for call options, suggesting that the market expects an upward momentum.
According to a report on crypto derivatives published by Amberdata, the inauguration of President Trump on January 20 may serve as a catalyst. The report states: "The days around Trump's inauguration ceremony could be a prime time for bullish statements or policies, which could further drive the price of Bitcoin upwards."
Institutional investors have also contributed to the recent optimistic sentiment. The US Bitcoin exchange-traded fund (ETF) reported significant inflows of funds last week.
BRN's chief analyst, Valentin Fournier, stated that "after the holidays, institutional interest has picked up again. This could pave the way for a strong rebound, especially as market participants anticipate Trump's inauguration on January 20." (The Block)
