Bitcoin approaches a significant monthly options expiry event representing approximately $3 billion in open interest contracts. Market observers identify the $106,000 level as the key ‘max pain’ point, potentially triggering heightened price volatility in the surrounding region around the expiration deadline.
Market sentiment indicators lean cautiously, evidenced by a put-to-call ratio of 1.05 favoring downside protection strategies. Trading volume also notably declined by 21% recently, settling around $28.9 billion, further suggesting a tentative trading environment.
Despite the cautious backdrop, Bitcoin maintains support above key technical levels, trading near the $108,800 mark and consistently holding above both its 10-day and 20-day moving averages. However, signals from technical indicators like the Moving Average Convergence Divergence (MACD) suggest recent upward momentum may be weakening.
Potential price scenarios include a drop towards the $106,000 max pain level if support fails below $107,500. Conversely, sustained trading above $108,000 accompanied by rising volume could reignite bullish momentum, potentially targeting new all-time highs. Analysts anticipate sharp price moves following the expiry outcome, depending on whether bullish or bearish positions gain control.