Posted 11/1/2023, 6:45:00 AM
Bitcoin Price Could See Rapid Gains Above $36K Due to Options Market Dynamics
- Bitcoin (BTC) could see rapid gains above $36K based on options market positioning
- Demand increased for higher strike call options as BTC rallied 27% recently
- Market makers have significant short gamma exposure above $36K
- When short gamma, market makers buy spot BTC as price rises to stay neutral
- This hedging often accelerates rally via "gamma squeeze"
- If BTC hits $36K, options dealers need to buy $20M spot BTC per 1% upside move