The U.S. Federal Reserve paused rate hikes in today’s FOMC presser, but noshitcoins says Bitcoin options data still suggests BTC price could briefly drop to $25,000.
Bitcoin's price has been pinned below $26,300 since June 10, reflecting a 14.8% correction in two months. Meanwhile, the Nasdaq tech stock market index gained 13.6% in the same period, indicating that investors are not exactly fleeing to the safety of cash and short-term debt. In fact, the demand for United States government bonds has been declining for the past six weeks.The yield on two-year U.S. Treasurys, for example, increased from 3.80% on May 4 to 4.68% on June 14.
The eight-week cumulative outflows for Bitcoin reached $254 million, representing approximately 1.2% of the total assets under management. Analysts at CoinShares have attributed this trend to monetary policy considerations, as interest rate hikes show no signs of slowing down, prompting investors to remain cautious.
However, if Bitcoin’s price remains near $26,000 at 8:00 am UTC on June 16, only $27 million worth of these call options will be available. This difference happens because the right to buy Bitcoin at $27,000 or $28,000 is useless if BTC trades below that level on expiry.Bulls need Bitcoin price at $26,500 to avoid a $100 million loss
This crude estimate considers the call options used in bullish bets and the put options exclusively in neutral-to-bearish trades. This oversimplification disregards more complex investment strategies.
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